The share price of India’s largest private sector bank by assets and market capitalization fell following news that its part-time chairman and independent director, Atanu Chakraborty, has resigned.
HDFC Bank Limited fell to ₹808.80, down by 4% from the previous closing price of ₹843.05 after Chakraborty stepped down and the board appointed a new interim part-time chairman.
Conflict with Personal Values and Ethics
In a letter to the Chairman of Governance, Nomination, Remuneration Committee of the bank, Chakraborty wrote that his decision is due to governance and ethical concerns within the institution.
“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. This is the basis of my aforementioned decision,” he said, according to NDTV. “I confirm that there are no other material reasons for my resignation other than those stated above.”
Interim Part-time Chairman to Serve for 3 Months
Following Chakraborty’s resignation, the Reserve Bank of India approved the appointment of Keki Mistry as HDFC Bank’s interim part-time chairman for a period of three months effective March 19.
“There is a full three-month period during which the board will take a call on who should be the full-time, non-executive chairman, or the independent director,” Mistry said.
Contribution to the Bank
Chakraborty joined the board in 2021. During his tenure, the bank witnessed a $40 billion merger with the Housing Development Finance Corporation (HDFC) that made HDFC Bank the second-largest bank in the country.
In an exchange filing, HDFC Bank acknowledged Chakraborty’s contribution to the bank during his term.
“Chakraborty does not hold directorship in any other company,” The bank stated. “The Board of Directors places on record its appreciation for Chakraborty’s contribution to the bank during his tenure and wishes him all the success in his future endeavours.”
Source: https://coinpaper.com/15557/hdfc-bank-stock-slides-4-after-chairman-resignation
