Soon after the Indian Express first reported on allegations of conflict of interest and nepotism against Chanda Kochhar she quits her job of Managing Director and CEO of ICICI Bank. After the regulatory push over the past few months, her departure is latest in a series of exits of top private bank chiefs.
The board of the Bank has agreed to grant her the early retirement who served for six months in her term. She was actually on leave since June 18 as there was investigation pending into various allegations against her and the bank which was looked into by the Supreme Court Judge Justice B N Srikrishna. The Bank said Kochhar will also relinquish office from the board of directors of the bank’s subsidiaries.
Justice Srikrishna had stated that that the investigation is not yet over when he was asked about the status of the investigation and said that there are a lot of other things to be done and he added that the enquiry panel had nothing to do with her quitting the job rather she has quit on her own.
Sandeep Bakshi was appointed as Managing Director & Chief Executive Officer by the board. The period of his appointment will be until October 3, 2023, which is subjected to regulatory and other such approvals.
On the other side, there was no specified reason for the sudden decision of Kochhar but the sources of the financial sector said that imminent regulatory action could have led her to quit. The central bank’s norms also add to this as it do not permit an incumbent CEO to stay out for more than a time period of 4 months which may have prompted this move.
It was after The Indian Express first reported during March 29 that Venugopal Dhoot who is a Videocon group promoter has provided crores of rupees to a firm which he had set up with Deepak Kochhar and two other relatives right after a loan of Rs3250 crores was granted to Videocon group during 2012 due to which the ICICI bank and Kochhar got into regulative scrutiny.
Six months after Dhoot received loan from ICICI Bank he transferred proprietorship of the company to a trust owned by Deepak Kochhar for an amount of Rs9 lakhs. During 2010 Dhoot gave NuPower Renewables Pvt Ltd an amount of Rs64 crore which he had set up with Deepak Kochhar and 2 other relatives. Bank stood firmly behind Chanda Kochhar stating she had committed no wrong and loan was written in accordance with bank’s credit standards only.
M.K.Sharma, the then chairman of Bank stated that the bank has satisfactorily replied to all the questions posed by regulators. A penalty of Rs58.9 Crores was imposed by RBI during April on ICICI bank stating it has allegedly violated the central banks guidelines governing the treasury operation. The Board of Bank instituted an enquiry on May 30th against Kochhar but didn’t specify the time when the final enquiry report is expected.
Courtesy/By: Rishikesh
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27 Jan 2019
