HDFC Bank has no ethics issue, says Chairman Rajiv Kumar, rules out systemic challenges concerns 

This assurance came months after former chairman Atanu Chakraborty resigned in March citing governance concerns. Kumar also highlighted the lender’s progress following the HDFC merger while shareholders approved all nine resolutions. 

‘No ethics or governance concerns’: HDFC Bank 

Referring to the governance concerns, Kumar said, “there is a lot of dust in the air and doubts on the horizon.”

“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.

Kumar also vowed to keep the shareholders’ trust intact by upholding the highest standards of corporate governance.

“The board is committed to ensure that the bank operates from the pedestals of highest levels of corporate governance, and remains anchored in integrity, transparency, accountability and prudent stewardship,” he said.

Former Chairman Atanu Chakraborty had resigned in March this year, citing concerns over ethics and values. Following Chakraborty’s exit, Keki Mistry served as interim chairman before Rajiv Kumar, a former Chief Election Commissioner and career bureaucrat, took over as the bank’s non-executive chairman.

Earlier this year, the bank’s board found irregularities in the mobilisation of high-value deposits from Maharashtra State Road Development Corporation (MSRDC). While it imposed penalties on the management led by Managing Director and CEO Sashidharan Jagdishan, it said there was no mala fide intent.

HDFC Bank commissioned an independent legal review after the resignation. The review did not find evidence substantiating the governance concerns referred to by Chakraborty. The review followed an independent disciplinary assessment.

Bank expects CASA ratio and margins to improve

Responding to shareholder concerns over the impact of the HDFC Ltd merger on the bank’s performance, Kumar said HDFC Bank will focus on increasing its low-cost current account and savings account (CASA) deposits over the coming quarters, which will help improve net interest margins.

Managing Director and CEO Sashidharan Jagdishan said the bank expects the CASA ratio to start improving from mid-2027 as investments made over the past few years begin to deliver results.

“We will have more low-cost fund ratio. Mid-2027 onwards, we will start to move upwards, which will have a favourable impact on NIMs,” Jagdishan said.

He said the bank has added around 4,000 branches over the past five years, and these investments, along with technology upgrades, are expected to drive more account openings and higher balances from existing customers.

Jagdishan added that while investments in generative artificial intelligence may take longer to generate returns, the technology investments already made will begin contributing to growth in the near term.

No lawsuit filed after chairman’s exit

Jagdishan also said no lawsuit has been filed against the bank following the decline in its share price after Chakraborty’s resignation. He added that the bank has completed a legal review and will be prepared to defend itself if any legal action arises in the future.

Conclusion: Shareholders approve all resolutions

Shareholders approved all nine resolutions placed before the AGM.

These included the adoption of the standalone and consolidated financial statements for FY26, declaration of dividend, reappointment of V. Srinivasa Rangan as director, fixation of remuneration for the joint statutory auditors and approval to issue Perpetual Debt Instruments, Tier II Capital Bonds and Long-Term Bonds through private placement.

Shareholders also approved the modification of the material related-party transaction with HDFC Life Insurance Company, the appointment of Rajiv Kumar as an Independent Director and his compensation as Part-time Chairman.