HDFC Chairman Exit Over Ethics Concerns, Atanu Chakraborty Flags Governance Gaps After March 18 Resignation

Mumbai: Former HDFC Bank part-time chairman and independent director Atanu Chakraborty has revealed that his resignation on March 18 was driven by ethical concerns, not personal conflicts. Speaking to CNBC-TV18 on March 30, he clarified that the decision was based on a difference in understanding of values and ethics.

Concerns Over Governance and Systems

Chakraborty raised serious questions about the bank’s governance practices. He said independent directors are responsible not just for reviewing management decisions, but also for ensuring fairness, transparency, and accountability towards customers. According to him, trust is the foundation of banking, and it must be protected.

Dubai Onboarding Issue Highlighted

He referred to a customer onboarding issue in Dubai, which the bank described as a “technical lapse.” However, Chakraborty said such incidents should not be taken lightly. He stressed that these situations reflect deeper gaps between values and systems and require strict oversight from the beginning.

Warning on Reputation Risks

Chakraborty warned that if regulators focus on such issues, it could damage the bank’s reputation. He said conduct-related problems must be addressed early to avoid larger risks in the future.

Performance and Financial Concerns

He also pointed out signs of underperformance in the bank. He mentioned a decline in share value, weak CASA (Current Account Savings Account) levels, and pressure on income ratios. He said identifying and correcting such issues is part of an independent director’s role.

“Act Before Crisis” Approach

Chakraborty emphasised the need for proactive action. He said banks should not wait for problems to grow before responding. Management must always remain aligned with the interests of shareholders, depositors, and the public.

No Regret Over Decision

He clarified that his resignation was not linked to falling share prices and that he holds no personal grievances. He also noted that such incidents may make others hesitant to take up independent director roles. He described the issue as one of “governance plus,” where ethics matter more than legal interpretations.