Sashidhar Jagdishan, managing director and chief executive of HDFC Bank, on Saturday decided not to seek reappointment after his current term ends on October 26. This brings an end to his 6-year tenure that also included the merger of HDFC with the bank.
“The board deeply appreciated his commitment, leadership, contribution to the growth and stability of the Bank and his role in successful completion of one of the largest mergers in corporate India,” the largest private sector lender declared in a regulatory filing.
The development comes as the top private lender faces concerns over legal, regulatory and leadership challenges.
Jagdishan, 61, has been facing intense scrutiny, especially after non-executive chairman Atanu Chakraborty stepped down in March this year, citing concerns on ethics and governance practices.
US securities fraud class-action lawsuit
HDFC Bank is facing a US securities fraud class-action lawsuit over allegations that it failed to disclose information material to investors regarding its dealings with the Maharashtra State Road Development Corporation (MSRDC) — allegations that previously triggered a drop in the bank’s US-listed shares following months of scrutiny and investigation.
The case, filed by an investor in a New York federal court, names the bank, Jagdishan, and CFO Srinivasan Vaidyanathan as defendants.
The US complaint reportedly alleges that HDFC Bank paid around Rs 45 crore in above-market interest to MSRDC, structured as sponsorship payments for an MSRDC road safety campaign in 2017 and 2021, at a time when the bank was seeking deposits from the state-owned corporation.
HDFC Bank constituted a Special Disciplinary Committee of Independent Directors to review the deposit arrangements.
Following the committee’s findings, the bank informed stock exchanges that the board had concluded the conduct amounted to “business overreach” rather than “mala fide action, personal enrichment, or improper motive.”
“However, keeping in view any potential divergence with the applicable RBI directions and based on the recommendations of the Special Disciplinary Committee of Independent Directors, the Board decided to issue warning letters and monetary penalty of ₹1 lakh for three senior employees (the Managing Director & CEO, Chief Financial Officer and Group Head — Retail Assets), and warning letters for the remaining employees,” the bank said in its stock exchange filing.
Atanu Chakraborty’s exit: Governance concerns & external probe clearance
On the evening of March 18, 2026, part-time chairman Atanu Chakraborty sent a resignation letter to the board’s Governance, Nomination and Remuneration Committee, stating that “certain happenings and practices within the bank” observed over the prior two years were “not in congruence with my personal values and ethics,” without naming any specific practice, person, incident, date, or department.
HDFC Bank subsequently appointed US law firm Wilson Sonsini Goodrich & Rosati and Indian law firm Wadia Ghandy & Co to conduct an external review, which concluded that the allegations raised by Chakraborty were not substantiated by the records and interviews examined. According to the bank’s disclosure, the review covered board and committee records, related communications, and interviews with independent directors, Jagdishan, and members of senior management.
Jagdishan described Chakraborty’s resignation as a “challenging event” for the lender in the bank’s FY26 annual report, reiterating that the independent legal review did not substantiate the concerns raised in the resignation letter.
“Towards the end of financial year 2025-26, the bank faced a challenging event with the resignation of Mr Atanu Chakraborty, Part-time Chairman and Independent Director of the Bank, on March 18, 2026,” Jagdishan said in his message to shareholders.
HDFC merger: The defining event
The mega-merger between HDFC Ltd and HDFC Bank stands out as the single most pivotal event of CEO Sashidhar Jagdishan’s leadership. First announced in April 2022, the transaction officially took effect on July 1, 2023, following mandatory approvals from regulators, shareholders, and tribunals.
By integrating India’s premier housing-finance institution into its largest private lender, HDFC Bank dramatically expanded both its mortgage footprint and total asset base. While the operational consolidation executed smoothly without major friction, it reshaped the bank’s underlying financial structure.
In the bank’s FY24 annual report, Jagdishan said borrowings accounted for about 21% of the merged bank’s balance sheet compared with roughly 8% before the transaction. The share of lower-cost current and savings account deposits had also declined.
Framing the expanded lender as “HDFC Bank 2.0,” he warned against mechanically measuring its financial metrics against pre-merger standards. Following the integration, addressing the structural imbalance by mobilizing deposits and reining in the bank’s elevated credit-deposit ratio became top priorities.
Credit Suisse AT1 bond mis-selling / DIFC branch lapses
In September last year, HDFC Bank informed stock exchanges of an action taken by the Dubai Financial Services Authority (DFSA) barring its Dubai International Financial Centre (DIFC) branch from onboarding new clients.
The action was linked to the alleged mis-selling of financial products, including AT-1 bonds tied to erstwhile Swiss lender Credit Suisse, that left several Middle East investors facing steep losses.
In October 2025, HDFC Bank told Bloomberg it had “not come across any instances of mis-selling” regarding the sale of Credit Suisse AT1 bonds, which were later written down after the Swiss lender’s 2023 rescue, causing losses for high-net-worth investors.
An internal review by the bank subsequently revealed gaps in client onboarding and compliance procedures at its DIFC (Dubai) branch. “The bank identified certain gaps in client‑onboarding requirements at its DIFC branch in the UAE and has completed a detailed and objective review of the matter,” the bank said in a statement to The Indian Express, adding that it has taken action against three executives, including Sampath Kumar, group head of branch banking, for their alleged involvement.
Lilavati Trust’s internal turmoil
The Lilavati Kirtilal Mehta Medical Trust (LKMMT), which runs Mumbai’s well-known Lilavati Hospital in Bandra, filed a defamation suit seeking Rs 1,000 crore in damages from the bank, alleging that it and its senior executives, including Sashidhar Jagdishan, had released statements to the media and on social media that were defamatory and harmed the trust’s reputation.
HDFC Bank opposed the plea, stating that the trust and its trustees had borrowed money from the bank and defaulted on repayment.
The high court dismissed the application, noting that the statements were not defamatory and were in fact accurate — pointing out that HDFC’s claims that the trustees owed substantial amounts to the bank, which were never repaid, and that the bank had initiated recovery and enforcement actions, were factually correct.
Earlier this month, HDFC Bank Chairman Rajiv Kumar reassured shareholders over governance concerns at the bank. At the bank’s 32nd Annual General Meeting (AGM), Kumar vowed to keep shareholders’ trust intact by upholding the highest standards of corporate governance.
“Systematically, there is nothing which has the challenge on either ethical or value parameters. Things are fine, the balance sheet is very pristine,” he added.
What next for HDFC Bank
As Sashidhar Jagdishan prepares to step down, HDFC Bank is heading for a crucial transition period. While the lender executed one of corporate India’s largest banking merger under his leadership, the ongoing governance concerns and international litigations have been grabbing headlines.
The job is cut out for the next successor and reassuring global investors will be primary. For now, the question now shifts to who will lead HDFC Bank next. While the appointment of the CEO is a time-consuming task, the board has clearly mentioned it is going to fast-track the process.