Shockwaves Hit HDFC Bank: Shares Plummet 5% Following Part-Time Chair’s Resignation Over Ethics Scandal!
Shares of HDFC Bank, India’s largest private lender, fell by 5% on Thursday following the resignation of its part-time chairman, Atanu Chakraborty. His departure was prompted by concerns he raised regarding governance and ethical practices within the institution.
In an investor call the same day, interim part-time chairman Keki Mistry clarified that Chakraborty did not provide the board with any specific evidence or details to back his allegations of unethical conduct. Mistry dismissed claims of internal discord, emphasizing that the management operates cohesively and will continue to do so. “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 stated in his resignation letter, which he submitted to HDFC Bank on March 17.
HDFC Bank is significantly invested in by foreign institutional investors, with over 47% of its shares held by entities such as the Government of Singapore and Norway’s Government Pension Fund Global, which own approximately 2.3% and over 1.2%, respectively. In Chakraborty’s resignation letter, he emphasized that “the middle and junior levels of the organization should form the core of a reimagined organization,” highlighting a need for structural changes within the bank.
Market analysts are closely monitoring the implications of Chakraborty’s resignation. Deven Choksey, founder and managing director of wealth management firm DRChoksey FinServ, characterized Mistry’s appointment as a “strong firefighting move.” He cautioned investors about potential “significant selling pressure” on HDFC shares, advising against any attempts to “bottom-fish” until governance issues are adequately addressed.
The Reserve Bank of India and HDFC Bank did not respond to requests for comment on the situation. As of Wednesday, HDFC Bank held a market capitalization of 13.08 trillion rupees (approximately $140 billion), surpassing the valuation of State Bank of India, which stood at 9.95 trillion rupees, according to LSEG data.
This turmoil comes as the banking sector in India grapples with ongoing scrutiny related to governance standards and ethical practices, making this a critical moment for HDFC Bank and its stakeholders. As developments unfold, investors and analysts alike will be watching closely for any further updates regarding governance and operational changes within the bank.
For the latest updates on HDFC Bank and the broader financial landscape in India, make sure to follow trusted news sources.
Original Source: https://www.cnbc.com/2026/03/19/hdfc-bank-shares-fall-chairman-resigns-unethical-practices.html
Category :
Tags:
Publish Date: 2026-03-19 10:55:00
