Winning Bizness Desk
Mumbai.HDFC Bank shares fell around 5% on Thursday after Part-time Chairman and Independent Director Atanu Chakravarty resigned late on March 18, raising concerns over the bank’s internal functioning. The stock dropped by about Rs 43 to trade near Rs 800, extending its decline to nearly 20% so far this year. The bank informed exchanges about the development, triggering a sharp reaction from investors.
Reasons cited for sudden resignation move
Atanu Chakravarty, a retired 1985-batch IAS officer of the Gujarat cadre, questioned the bank’s internal culture in his resignation letter. He said certain developments over the past two years did not align with his personal ethics and values.
- Raised concerns over internal practices and culture
- Flagged mismatch with personal ethical standards
- Observed issues during his two-year tenure
- Decided to step down with immediate effect
His exit has come unexpectedly, especially as his tenure was scheduled to continue until May 2027.
Keki Mistry appointed interim chairman for now
Following his resignation, the bank has appointed Keki Mistry as interim Chairman for three months, subject to Reserve Bank of India approval. Mistry is currently a Non-Executive Director on the board and brings extensive experience from his time at HDFC Ltd.
- Former Vice Chairman and CEO of HDFC Ltd
- Known for deep experience in financial sector
- Appointment effective from March 19
- Temporary arrangement for three months
After taking charge, Mistry assured investors and stakeholders that the bank remains stable and there is no cause for concern.
Rbi reassures stability and strong financial position
The Reserve Bank of India said it has approved the interim arrangement requested by the bank. It described HDFC Bank as a systemically important institution with strong financials.
- Adequate capital and liquidity position
- No serious governance concerns flagged
- Professional board and capable management
- Continuous engagement with bank leadership
The central bank’s statement aims to calm market sentiment following the sudden leadership change.
Market reaction reflects investor nervousness
Despite regulatory reassurance, the market reacted sharply to the news. The stock’s fall indicates investor concern over governance signals and leadership uncertainty.
- Shares down 5% in a single session
- Around 20% decline recorded this year
- Immediate reaction to resignation news
- Sentiment remains cautious in short term
Analysts say clarity on leadership and governance will be key to restoring confidence.
Merger milestone and chairman’s career background
Chakravarty also highlighted key achievements during his tenure, including the merger of HDFC Ltd with HDFC Bank, which made it the second-largest bank in India. However, he noted that full benefits of the merger are yet to be realised.
He served over 35 years in government, holding positions such as Secretary of Economic Affairs and playing a role in budget-making and investment policy. He was first appointed as Chairman in April 2021 and reappointed in May 2024.
Understanding roles: part-time and interim chairman
A part-time Chairman does not handle daily operations but guides the board and policy decisions. An interim Chairman, on the other hand, is a temporary appointment made when the position falls vacant unexpectedly.
Given that banks handle public money and are critical to the economy, RBI approval ensures that leadership remains fit, proper and credible during transitions.
