HDFC Bank on Friday said an independent legal review conducted by two external law firms found no evidence to substantiate the concerns raised by former chairman Atanu Chakraborty in his resignation letter, concluding that the contemporaneous records and witness interviews did not support his allegations.
In a stock exchange filing, the country's largest private sector lender said the review was carried out by Wilson Sonsini Goodrich & Rosati and Wadia Ghandy & Co. over a three-month period. The firms examined thousands of documents, including board and committee meeting minutes, agenda papers, and other records covering the two years preceding Chakraborty's resignation. They also interviewed all independent directors, committee chairpersons, Managing Director and CEO, and several senior executives.
The review was commissioned after the bank informed stock exchanges on March 24 that it had appointed external law firms to examine whether the issues flagged by Chakraborty in his resignation letter were borne out by records, whether he had recorded any dissent during board deliberations, and whether such dissent, if any, had been addressed.
According to the report, the external law firms repeatedly requested Chakraborty to participate in the review process, but the interview ultimately did not take place.
The law firms concluded that Chakraborty's statement "and its implications were not substantiated by the record and witness interviews." They found that board minutes underwent a comprehensive drafting and approval process that gave Chakraborty opportunities to record any objections or concerns. However, they found no contemporaneous evidence in board or committee records, meeting materials or related communications to support his claims.
The report further stated that witness interviews did not corroborate Chakraborty's allegations. It also addressed references made by the former chairman in public statements after his resignation regarding the bank's Dubai-related matter, saying investigators found no contemporaneous evidence that he had expressed ethical concerns or disagreed with decisions taken by the board or its committees on the issue or any other matter.
"In sum, the contemporaneous evidence reviewed was inconsistent with Mr. Chakraborty's Statement, and External Law Firms' review did not identify any basis for the Statement," the report concluded.
Chakraborty, a former Finance Secretary to the Government of India, resigned as the part-time chairman of HDFC Bank earlier this year before the completion of his term. His resignation letter referred to certain "happenings and practices" that he said were not in consonance with his personal values and ethics, prompting the bank's board to commission an independent legal review by external counsel. Friday's filing marks the conclusion of that review, with the bank stating that the allegations were not supported by documentary evidence or witness testimony.
