HDFC Bank has stated that an independent legal review found no evidence to substantiate the allegations made by former chairman Atanu Chakraborty in his resignation letter and subsequent public remarks, according to a bank statement to the stock exchanges.
The Review and Its Findings
The review was conducted over a three-month period by law firms Wilson Sonsini Goodrich & Rosati, PC and Wadia Ghandy & Co. The terms of reference, issued on March 24, defined the relevant time period as the two years preceding Chakraborty’s resignation. The legal team examined board and board committee minutes, conducted interviews with directors and senior management, and reviewed documents and information.
"The minutes of the meetings Mr. Chakraborty attended were a product of a comprehensive drafting, review and approval process that afforded Mr. Chakraborty an opportunity to record any 'happenings and practices' that purportedly were not in congruence with his personal values and ethics. No contemporaneous support for Mr. Chakraborty’s statement was found in the Board or Board Committee minutes or materials reviewed, or in contemporaneous communications about the review and approval of the minutes of meetings he attended," the bank said.
The firms concluded that if these ethical conflicts existed, Chakraborty did not record them, dissent to them, or communicate them through official board channels during the two-year reference period, even though he had the opportunity.
The Dubai Matter and AT1 Bonds
The bank also addressed the Dubai matter referenced by Chakraborty in post-resignation public statements. The review found no contemporaneous evidence that he raised any concerns about his personal values and ethics, or that he disagreed with any decisions made by the Board or relevant Board Committees in connection with that matter. The bank maintained that the only reason it had fallen foul of regulators in the UAE was the failure to re-onboard customers from another jurisdiction within the UAE.
Regarding AT1 bonds, which saw allegations of mis-selling, the bank referred to the issue but did not elaborate. The bank has consistently maintained that there was no mis-selling.
Implications for Corporate Governance
For CFOs and treasury professionals, this case highlights the critical importance of contemporaneous documentation and formal dissent channels in corporate governance. Directors are expected to record any ethical concerns through official board processes. The review's conclusion—that Chakraborty's current public stance is inconsistent with his past official position—reinforces the need for transparent record-keeping at the board level. Investors and governance analysts will likely view the bank's thorough investigation as a positive step in addressing governance questions, though the episode underscores the reputational risks when directors air grievances externally without prior internal documentation.
| Aspect | Chakraborty's Claim | Review Finding |
|---|---|---|
| Ethics and values | Bank acted against his personal ethics | No contemporaneous evidence in board minutes or communications |
| Dubai matter | Referenced in post-resignation statements | No evidence he raised concerns during his tenure |
| AT1 bonds | Allegations of mis-selling | Bank maintained no mis-selling; failure was re-onboarding customers from another UAE jurisdiction |
The bank's statement emphasized that the review focused entirely on the inconsistency between Chakraborty’s current public stance and his past official position.
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