New Delhi: An independent enquiry ordered by ICICI Bank on Wednesday found Chanda Kochhar in violation of the lender’s code of conduct as well as rules governing conflict of interest, and consequently, the bank announced penal action against its former chief. Former Supreme Court judge BN Srikrishna, who was heading the probe, submitted the report to the bank’s board on Wednesday, according to ICICI Bank’s filing with the stock exchanges. “The enquiry report, with the scope period of April 1, 2009 to March 31, 2018…concluded, primarily on account of ineffectively dealing with conflict of interest and due disclosure or recusal requirements, that Ms Chanda Kochhar was in violation of the ICICI Bank Code of Conduct, its framework for dealing with conflict of interest and fiduciary duties, and in terms of applicable Indian laws, rules and regulations,” the bank said.
On May 30, the private sector lender had ordered an independent probe to examine allegations made via anonymous whistleblower complaints. It was alleged that Kochhar did not comply with disclosure norms regarding loans extended by ICICI Bank to the Videocon Group, and dealings between Videocon Group and NuPower Renewables, a company co-founded by Videocon Group Chairman Venugopal Dhoot and Kochhar’s husband Deepak Kochhar. She also faced allegations of quid pro quo in a $500-million loan extended to Videocon Group, a large portion of which has since turned non-performing. On Wednesday, ICICI Bank said the report will have no impact on financial statements released by the lender during the period covered by the enquiry panel. Pending investigation, Kochhar was on an indefinite leave. Subsequently, in October, she stepped down as managing director and chief executive officer of ICICI Bank by opting for early retirement. The bank had then said that the enquiry against Kochhar, initiated by the bank’s board, would remain unaffected even after her exit, and “certain benefits will be subject to the outcome of the enquiry”.
The board decided to treat the separation of Kochhar from ICICI Bank as a “Termination for Cause” under the bank’s internal policies and code of conduct. This would include revocation of all her existing as well as future entitlements such as any unpaid amounts, and also claw back all bonuses paid to her between April 2009 and March 2018. The bank added that it will take further actions if warranted.
