The Board of HDFC Bank is scheduled to meet mid next week to address the leadership transition following the sudden resignation of Part-Time Chairman Atanu Chakraborty. The meeting aims to evaluate the situation and discuss potential candidates for the upcoming leadership role.
While Keki Mistry, a veteran of the HDFC Group, has stepped in as Interim Part-Time Chairman effective March 19, 2026, for a three-month period, sources indicate that the Board is eager to expedite the process of appointing a permanent successor.
During an analyst call, Mistry stated, “The Board will meet very soon to determine the way forward and seek explanations from Chakraborty.” The possibility of appointing a career central banker, such as former RBI Deputy Governor M. Rajeshwar Rao, is reportedly under consideration. Notably, Shyamala Gopinath, another former RBI Deputy Governor, served as Chairperson of HDFC Bank from 2015 to 2021.
Investor Anxiety Mounts
Chakraborty’s abrupt resignation, citing “certain happenings and practices within the bank,” has unsettled investors. The bank’s management and the Reserve Bank of India (RBI) have provided limited details, leading to skepticism among market analysts about the transparency of the unfolding events.
Shares of HDFC Bank declined to a new low of ₹772 during intraday trading before closing at ₹780. Chakraborty’s attempts to downplay the resignation as “routine,” suggesting no wrongdoing, have failed to reassure investors.
Expert Opinions on Accountability
Shriram Subramanian, MD of Ingovern Research Services, emphasized the need for a transparent investigation. He suggested the formation of a fact-finding committee by the independent directors to address the allegations and produce a report to restore investor confidence. Subramanian also called for an independent probe by the RBI into the matter.
Banking industry veteran Uday Kotak highlighted the importance of accountability, advocating for promoters to have “skin in the game” to prevent risky decisions and protect depositors’ interests.
Market analysts pointed out that unresolved issues remain surrounding the appointment of a permanent Chairman and the reappointment of MD & CEO Sashidhar Jagdishan, which could influence investor sentiment. Sameer Sawant of Mirae Asset Sharekhan advised large institutional investors to engage closely with the board and demand transparency, especially given the bank’s broad shareholder base without a controlling promoter.
From a strategic perspective, Wadhwa noted that despite the temporary setback, the situation appears manageable with RBI and bank oversight. He suggested that, with valuations around 1.5 times book value, patient long-term investors might view this as an opportunity rather than a concern.
Mistry, who is 71, reaffirmed his commitment to the role, stating he would not take on the interim chairmanship unless the bank’s systems and governance aligned with his principles. He also dismissed speculations of a “power struggle,” emphasizing that the RBI approved his appointment solely for stabilizing the bank.
Renu Sud Karnad, a non-executive director, remarked that the bank repeatedly sought clarity from Chakraborty about his resignation, but he offered no substantial explanation.
The RBI, in a statement issued Thursday, reaffirmed confidence in HDFC Bank’s governance, noting that the bank remains a Domestic Systemically Important Bank (D-SIB) with sound financials and a competent management team. It also assured that there are no material concerns regarding the bank’s conduct or governance based on periodic assessments.
