HDFC Bank announced that its board has taken action against Managing Director and CEO Sashidhar Jagdishan, CFO Srinivasan Vaidyanathan, and Group Head – Retail Assets Arvind Vohra by issuing warning letters and imposing a Rs 1 lakh monetary penalty on each of them. This decision came after an internal review into the bank’s deposit dealings with the Maharashtra State Road Development Corporation (MSRDC). The review was conducted by a Special Disciplinary Committee of Independent Directors, focusing on the bank’s deposit mobilization with the state-owned corporation in 2017 and 2021.
The board clarified that the employees’ actions were deemed as business overreach rather than any malicious intent, personal gain, or improper motive. The largest private sector lender in the country stated that the board’s decision was based on the committee’s recommendations and the possibility of deviation from Reserve Bank of India (RBI) directives. The board also highlighted that the outcome of the review would be shared with the RBI for further action.
In addition to the penalties imposed on the top executives, warning letters were issued to other employees involved in the matter. The board’s directive included communicating the review findings to the RBI for transparency and compliance purposes. HDFC Bank emphasized that the actions taken were a result of the internal review process related to the deposit arrangements with MSRDC in 2017 and 2021.
