HDFC Bank Shares Rise After Probe Rules Out Ex-Chairman Atanu Chakraborty’s Concerns

Shares of HDFC Bank, India's largest private sector lender, rose on June 29 after the bank said an independent legal review found no evidence to support the concerns raised by former Chairman Atanu Chakraborty in his resignation letter.

The bank had appointed US law firm Wilson Sonsini Goodrich & Rosati and Indian law firm Wadia Ghandy & Co. to conduct the review after Chakraborty stepped down from the board on March 18, 2026, citing differences over "values and ethics". His sudden exit had triggered a sharp selloff in the stock and raised questions about governance at the lender.

At 11:16 AM, HDFC Bank shares were trading at Rs 804.80, up nearly 1 per cent from the previous close. While the stock has rebounded more than 10 per cent from its recent low, it is still below the level seen before Chakraborty's resignation.

Announcing the outcome of the review, HDFC Bank said: "The contemporaneous evidence reviewed was inconsistent with Mr. Chakraborty's Statement, and External Law Firms' review did not identify any basis for the Statement."

According to the bank's exchange filing dated June 26, the legal review examined whether any concerns referred to by Chakraborty were evident in board records, whether he had recorded any dissent during meetings, and whether any such concerns had been addressed.

The review covered the two-year period preceding Chakraborty's resignation. The external law firms examined board and committee meeting minutes, agenda papers, internal documents and communications, and also interviewed independent directors, committee chairpersons, Managing Director and Chief Executive Officer Sashidhar Jagdishan, and senior executives overseeing control and assurance functions.

The firms told the board that the review was conducted over a period of three months and involved the examination of thousands of documents along with interviews of independent directors and members of senior management.

The bank said both it and the external law firms repeatedly requested Chakraborty to participate in the review process. However, the interview with the former chairman "did not occur".

The law firms said the minutes of the meetings attended by Chakraborty went through a detailed drafting, review and approval process and gave him sufficient opportunity to place on record any concerns or disagreements.

They also found no evidence in board minutes, committee records or contemporaneous communications that supported the concerns mentioned in his resignation letter.

"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 quoted the law firms as saying.

The review further stated that interviews with directors and senior executives did not support or substantiate the claims made in Chakraborty's statement.

The law firms also examined the so-called Dubai matter, which Chakraborty had referred to in public statements after his resignation. According to the report, no evidence was found to suggest that he had raised concerns related to his personal values and ethics or disagreed with decisions taken by the board or its committees regarding the matter.

"Although Mr. Chakraborty referred to the Dubai matter in post-resignation public statements, no contemporaneous evidence was identified reflecting 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," the report said.

The findings are likely to provide relief to investors after months of uncertainty surrounding the circumstances of Chakraborty's exit. His resignation had sparked concerns over corporate governance at the country's largest private lender and weighed on investor sentiment.