'No power struggle': HDFC Bank's interim chair on Atanu Chakraborty exit

Keki Mistry says there are no material concerns at HDFC Bank after Atanu Chakraborty's exit, rules out governance issues, and says the board will review organisational structure

HDFC Bank’s interim chairman Keki Mistry on Thursday ruled out any internal power struggle following the sudden resignation of part-time chairman Atanu Chakraborty and sought to reassure investors that the lender remains stable with no material concerns.

 

In his first remarks after assuming charge, Mistry said the board is committed to maintaining confidence in the country’s largest private-sector lender, reported Reuters. “The board remains committed to safeguarding investor confidence,” he said, adding that there are “no material matters at this point of time”.

 

He also emphasised continuity in the bank’s operations. “We will continue to ensure that trust in the bank is maintained,” Mistry said.

   

What did HDFC Bank say on governance concerns after Chakraborty exit?

 

Addressing Chakraborty’s abrupt exit, Mistry said the board was unaware of the specific issues raised in his resignation letter. “None of us are aware of the issues raised by Chakraborty in the letter,” he said, reported Reuters.

 

He indicated that the development may stem from a relationship issue between Chakraborty and the management, while clarifying that the resignation has no link to the bank’s operational performance. “There could be a relationship issue between Chakraborty and the management,” he said, adding, “This has nothing to do with the operational profitability of the bank.”

 

Mistry further ruled out any internal power struggle. “There is no power struggle within the bank,” he said. “There has been no discussion with regards to governance within the board.” He added that the board will meet soon to deliberate on the situation. 

 

Will HDFC Bank review its organisational structure?

 

On the organisational structure, Mistry said the bank will review its framework going forward. “We will re-examine the organisational structure as we move forward,” he said, reported Reuters.

 

He also indicated that deputy managing director (MD) Kaizad M Bharucha will take on a larger role. “Bharucha will get more responsibilities going forward,” Mistry said.

 

Why did Atanu Chakraborty resign from HDFC Bank?

 

The reassurance from the bank comes after Atanu Chakraborty stepped down with immediate effect, citing ethical concerns in a resignation letter. The lender announced Chakraborty’s resignation late Wednesday (March 18).

 

“Certain happenings and practices within the bank, that I have observed over the last two years, are not in congruence with my personal values and ethics,” Chakraborty wrote in his letter to the board, without elaborating further.

 

In a regulatory filing late Wednesday night, HDFC Bank said the Reserve Bank of India (RBI) had approved Mistry’s appointment as interim part-time chairman for a period of three months starting March 19.