Resignation letter to be reviewed
HDFC Bank, in an exchange filing, said it has appointed external law firms to review the resignation letter of its part-time chairman Atanu Chakraborty. The law firms will provide a report within a reasonable period of time, it said.
Chakraborty resigned as part-time chairman and independent director of the lender on March 18, citing differences with the board.
Chakraborty in his resignation letter had stated that there were certain happenings and practices within the bank that he had observed over the last two years and they were not in congruence with his personal values and ethics. He cited this as the basis of his decision to resign in the letter.
The appointment of law firms is to independently look at aspects mentioned in the resignation letter, sources told CNBC-TV18, adding that the aim is to ensure an objective and fact-based assessment.
Sources said the appointment of law firms is a step to constantly benchmark with the highest governance standards.
“Appointing an external law firm is a positive step. The report should be placed in the public domain, and a definitive timeline would help. Management assurances alone are not sufficient — shareholders need clarity. If the Chairman is in the wrong, so be it; it should be called out. The issues could range from personality clashes to lack of information, but investors require transparency and assurance,” said Shriram Subramanian, Founder & MD of InGovern.
Removal of three employees
HDFC Bank on Monday said its latest removal of three employees was following an internal probe linked to a Dubai regulatory notice and that it had no material impact on the bank.
The lender clarified to the exchanges that it referred to a report on the matter and the action traced back to a decision notice it received on September 25, 2025 from the Dubai Financial Services Authority (DFSA) by its Dubai International Financial Centre (DIFC) branch.
HDFC Bank said the Governance, Nomination and Remuneration Committee (GNRC) had directed an internal investigation under its conduct regulations. The probe officer submitted findings to the disciplinary committee, and after discussions recommended staff accountability actions to the GNRC.
The GNRC, during its March 9 meeting, decided on the actions, including the termination of the three employees from service. The lender said the employees could appeal the decision before the Appellate Authority, which is the board of directors.
Last week, CNBC-TV18 had reported that the lender had terminated the employment of Sampath Kumar, Group Head of Branch Banking, along with two other senior executives — Harsh Gupta, Executive Vice President for the Middle East, Africa and NRI onshore business, and Payal Mandhyan, Senior Vice President — due to their alleged involvement in the mis-selling of additional tier-1 (AT1) bonds of Credit Suisse.
Gupta and Mandhyan had been suspended since January 2025 pending the outcome of an internal probe linked to the Dubai branch.
Investor allegations
The issue pertains to allegations, primarily made by non-resident Indian (NRI) investors, who had claimed they were misled into shifting their foreign currency deposits and sold AT1 bonds as fixed-maturity instruments, despite their perpetual nature.
The bonds, worth $20 billion, were written off during the Credit Suisse bailout. However, a Swiss court later termed the write-off unlawful and the ruling is currently under appeal.
Post this, the Dubai Financial Services Authority barred HDFC Bank from onboarding new clients at its Dubai branch.
HSBC Cuts Price Target
On Monday, brokerage firm HSBC cut its price target on HDFC Bank to ₹990 from ₹1,070 earlier, stating that it could see compression in its valuation multiples.
It added that performance will have to improve from HDFC Bank to offset the current sentiment impact.
45 out of the 47 analysts tracking HDFC Bank have a “buy” rating on the lender.
Shares of HDFC Bank Ltd. were tading 1.7% up at ₹756.65 apiece just after market open on Tuesday. The stock had declined 12% in the previous four trading sessions. It is down 17.2% in the past month.
Also Read: Coal India subsidiary CMPDI IPO Day 3: GMP at ₹1 on final day; check subscription status
