28 Jul , 2026 By : Debdeep Gupta
Shares of HDFC Bank declined in morning trade on Tuesday after the private lender disclosed that its board had imposed a monetary penalty on Managing Director and Chief Executive Officer Sashidhar Jagdishan, Chief Financial Officer Srinivasan Vaidyanathan and Group Head (Retail Assets) Arvind Vohra following an internal review of its arrangement with the Maharashtra State Road Development Corporation (MSRDC).
The stock was trading at Rs 732.95, down 0.89%, at around 10:13 am on the NSE.
HDFC Bank on July 27 said Jagdishan, Vaidyanathan and Vohra were fined Rs 1 lakh each on the board's recommendation. The decision followed an internal review of the bank's arrangement with MSRDC for garnering deposits in 2017 and 2021.
In a stock exchange filing, the bank said that during a meeting of the special disciplinary committee of independent directors, the board did not find anything conclusive that would constitute mala fide action, personal enrichment or improper motive. However, it said the conduct of the employees involved constituted "business overreach".
"Keeping in view any potential divergence with the applicable RBI Directions and based on the recommendations… the Board decided to issue warning letters and a monetary penalty of Rs 1 lakh for three senior employees (the Managing Director & CEO, Chief Financial Officer and Group Head - Retail Assets), and warning letters for the remaining employees," the bank said in the filing.
The board also directed that the matter be communicated to the Reserve Bank of India.
Earlier in May, media reports had alleged that HDFC Bank paid Rs 45 crore to the MSRDC to attract large deposits. The reports claimed these payments were classified as "marketing spends" and that Jagdishan was aware of the payments.
HDFC Bank had denied any wrongdoing, stating that it had robust internal oversight, audit and control processes and that all issues were dealt with in accordance with established norms.
The development also comes after another independent legal review found no evidence or record to support the ethical and governance concerns raised by former chairman Atanu Chakraborty when he resigned in March 2026.
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