New Delhi: Largest private sector lender HDFC Bank on Wednesday denied allegations of wrongdoing related to reported payments worth Rs 45 crore allegedly routed through its marketing department to a Maharashtra government agency.
The bank’s spokesperson, in a statement, said that its internal oversight and audit mechanisms are robust and that all matters are handled according to established procedures.
All matters are handled in accordance with the bank’s established norms and the full process is always followed before final determination after any internal review, the statement said.
“We strongly reject any assumption of wrongdoing or guilt based on selective material,” the statement added.
The clarification came after media reports claimed that the bank’s audit committee had launched an ‘internal vigilance probe’ into payments amounting to Rs 45 crore to the Maharashtra State Road Development Corporation (MSRDC) that were allegedly disguised as marketing expenses.
Shares of HDFC Bank closed at Rs 758.50 apiece, down 2.63 per cent, on the BSE.
According to reports, the payments were allegedly made to a Maharashtra government undertaking just days before former chairman Atanu Chakraborty resigned on March 18.
Chakraborty, in a surprise move, resigned as chairman of HDFC Bank, citing ethical concerns, on March 18.
This was the first time that the part-time chairman of HDFC Bank left midway, raising concerns about its functioning.
In a regulatory filing, HDFC Bank said Chakraborty had on March 18 tendered his resignation as part-time chairman and independent director of the bank with immediate effect.
Chakraborty was appointed part-time chairman effective May 5, 2021, almost a year after his retirement as Economic Affairs Secretary.
His mandate was extended for another three years in 2024 until May 4, 2027.
Chakraborty, a 1985 batch IAS officer of Gujarat cadre, retired as Secretary, Department of Economic Affairs in April 2020. Before that, he was Secretary, Department of Investment and Public Asset Management (DIPAM). Both departments are under the Ministry of Finance.
Chakraborty became chairman during the reverse merger process of the bank with parent HDFC Ltd, a leading mortgage firm in the country.
