HDFC Bank has fined its chief executive Sashidhar Jagdishan, outgoing chief financial officer Srinivasan Vaidyanathan and group head of retail assets Arvind Vohra `1 lakh each for their role in the higher-priced deposits offer given to the Maharashtra State Road Development Corporation (MSRDC).
In an exchange filing on Monday, the largest private sector bank said the decision to impose exemplary fine on the key executives was taken on the recommendation of the board.
The decision was reached after an internal review of the arrangement with MSRDC for garnering deposits in 2017 and 2021 offering higher rate of interest.
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 but the conduct of the employees involved constituted business overreach, the bank told stock exchanges.
“Based on the findings and recommendation of the special disciplinary committee of independent directors, the board at its meeting held on July 23, 2026, concluded that the conduct of the employees involved constituted business overreach rather than any mala fide action, personal enrichment, or improper motive.
“However, keeping in view any potential divergence with the applicable RBI directions and based on the recommendations of the special disciplinary committee of independent directors, the board decided to issue warning letters and monetary penalty of Rs 1 lakh on the CEO, CFO and the group head of retail assets, and warning letters for the remaining employees,” the filing said.
Earlier in May, media reports said HDFC Bank had allegedly paid Rs 45 crore to the MSRDC to attract large deposits. These payments were classified as marketing spends and Jagdishan was aware of these payments being made. Though the state government body offered to deposit over Rs 20,000 crore with the bank, not even a 10th of that promised sum was deposited.
The bank had then denied any wrongdoing saying it had robust internal oversight, audit and control processes and all issues were dealt with in accordance with the established norms.
It can be recalled that on March 18 this year the then part-time chairman Atanu Chakraborty had resigned alleging unspecified actions at the bank which are not in congruence with his ethics and morality. Following this the bank appointed three law firms and their review did not find any evidence or record to support the allegations.