HDFC bank chairman quits over ethical concerns, flags internal practices

In a sudden and significant development, HDFC Bank Part-time Chairman and Independent Director Atanu Chakraborty has resigned with immediate effect, citing ethical concerns and flagging “certain happenings and practices” within the bank that, he said, conflicted with his personal values.

In a letter addressed to the Chairman of the bank’s Governance, Nomination and Remuneration Committee, Chakraborty wrote that developments he had observed over the past two years were “not in congruence with my personal values and ethics”, forming the basis of his decision to step down.

He did not elaborate on the specific issues, adding that there were no other material reasons behind his resignation.

The exit comes amid indications of unease within the board over the bank’s functioning in recent months, though no official details have been disclosed.

Following the resignation, the Reserve Bank of India has approved the appointment of Keki Mistry as interim part-time Chairman for a period of three months, effective March 19. Mistry previously served as Vice-Chairman of HDFC Ltd prior to its merger with the bank.

In a regulatory filing, HDFC Bank reiterated that there were no reasons for Chakraborty’s resignation beyond those stated in his letter, while placing on record its appreciation for his contribution during his tenure.

Chakraborty, who joined the board in May 2021, oversaw a transformative phase in the bank’s journey, including the landmark merger with HDFC Ltd that created a financial conglomerate and propelled the bank to become India’s second-largest by market capitalization, currently at ₹12.97 lakh crore. He noted, however, that the full benefits of the merger are yet to be realized.

A retired IAS officer of the Gujarat cadre, Chakraborty has held key positions in the Union government, including Secretary in the Department of Economic Affairs during FY 2019–20, where he played a central role in economic policymaking and the Union Budget process. He also served in senior roles in the Ministry of Finance and the Gujarat government, contributing to infrastructure appraisal, subsidy management, and financial reforms.

His abrupt departure, coupled with the pointed reference to internal practices, raises fresh questions around governance dynamics at one of India’s most valuable banks, even as the institution maintains there are no additional disclosures tied to the move.