HDFC Bank: HDFC Bank Chief Executive and Managing Director Sashidhar Jagdishan said on Thursday that the board has asked former chairman Atanu Chakraborty to reconsider his decision of resignation.

Jagadeesan said that the board members not only convinced Atanu Chakraborty to withdraw his resignation, but also asked him to take back the strong words used in his resignation letter, such as against ethics and principles. However, Atanu did not agree.

What else did the CEO say?

The board sought clarification from him on those incidents, working methods and practices. He was asked to give his clear opinion on these, but he did not give anything concrete. The CEO said that everyone was surprised by Atanu Chakraborty’s resignation submitted on March 17 as no serious issues of corporate governance were found in the bank. The bank has clarified that the resignation of the former CEO may not be due to any major irregularities, but may be due to differences in personal views and way of working.

Whenever a senior level official in a big organization resigns, investors feel that something must be wrong. To clear this misconception of investors, the CEO assured that there is no fault in the banking system. The bank is in safe and honest hands.

HDFC Bank shares under pressure

HDFC Bank shares fell by another 2 percent in intraday trading on Friday, March 20. This is the second consecutive day when the bank’s shares were seen slipping. Shares of India’s largest private lender were seen trading at the day’s lowest level of Rs 781 and remained close to its new 52-week low of Rs 772 made in the last trading session. HDFC Bank shares have fallen by 10 percent so far in March. With this, it is moving towards the biggest monthly decline since March 2020.

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‘Everything is fine…’ After the resignation of the chairman, HDFC Bank gave clarification, said- ‘There is no power struggle’

HDFC Bank Share: A big fall is being seen in the shares of HDFC Bank today. The bank’s shares fell by 7 percent in early trading. In fact, the bank’s non-executive chairman Atanu Chakraborty immediately resigned from his post on Wednesday, March 18. He left his post citing ‘Personal Values ​​and Ethics’. He says that in the last two years, he has seen some incidents and working methods within the bank, which are not in accordance with his principles. He also clarified that there is no other major reason for his resignation. Shortly after the start of trading, the stock fell by 8.66 percent to the level of Rs 770, which is its new 52-week low.

Reason for fall in shares

• HDFC Bank shares are under selling pressure today due to the resignation of the bank’s non-executive chairman Atanu Chakraborty.
• In his resignation letter, he stated that some of the working methods and procedures in the bank are against his ‘Personal Values ​​and Ethics’, which can raise new questions regarding the governance system of the bank.
• After the news of the resignation of the Chairman, a decline of more than 7 percent was recorded in the ADR of HDFC Bank listed in the American stock market.

huge loss to investors

Due to this fall in the shares of HDFC Bank today, investors have suffered a huge loss of about Rs 1.03 lakh crore. Besides, heavy pressure is also being seen on Nifty Bank Index. At present, the bank has appointed its former CEO Keki Mistry as its interim chairman for three months.

What explanation did the bank give?

On the news of the chairman’s resignation, the bank clarified that the reason for differences between the chairman and the board was not on moral values, but on the way of working and the way of implementing decisions. The bank has denied reports of ‘power struggle’ between the management and the CEO.

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HDFC Bank Chairman Resigned: Atanu Chakraborty immediately resigned from the post of non-executive chairman of HDFC Bank on Wednesday, March 18. He has cited ‘Personal Values ​​and Ethics’ behind his decision. By saying this, new questions may arise regarding the governance system in the bank, which is very important for the entire banking system.

In a regulatory filing, the bank said that retired civil servant Atanu Chakraborty has resigned from the post of part-time chairman and independent director. Atanu, former economic affairs secretary, joined the bank’s board in May 2021 and served as chairman when HDFC was merged with the bank. HDFC said that RBI has approved the appointment of Keki Mistry as interim part-time chairman for 3 months. This appointment will be effective from Thursday.

Chairman re-elected with the approval of RBI

Atanu Chakraborty said in his resignation letter that in the last two years, he has seen some incidents and ways of working within the bank, which are not in accordance with his principles. He also clarified that there is no other major reason for his resignation. His departure is surprising, as he was re-appointed for a tenure till May 2027 with the approval of RBI.

For the first time, he became the chairman of the bank for three years in May 2021. The board again recommended his name in December 2023. The Reserve Bank had approved his second term on May 2, 2024. His new tenure was fixed from May 5, 2024 to May 4, 2027.

Impact will be visible on shares

HDFC Bank has about 15 percent of the total deposits of the country. In such a situation, sudden resignation of the Chairman is a big deal, which can have a visible impact on the shares. With the opening of the market on March 19, there is heavy selling pressure on bank shares.

On Tuesday, shares of HDFC Bank closed at Rs 842 with a decline of 0.40 percent compared to the previous day. A fall of up to Rs 831.60 was seen in the shares during trading. The share closed at Rs 842.95 on BSE. At the same time, shares were traded in a huge volume of about Rs 2.35 crore on NSE.

A huge fall of more than 7 percent was seen in the ADR of HDFC Bank listed in the American stock market last night. The investors here immediately responded to the news of the chairman’s resignation.

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