ICICI Bank Ltd.’s Managing Director and Chief Executive Officer Chanda Kochhar refused to answer questions on the Videocon Industries Ltd. loans matter that put her under the scanner in March, saying the board has made its position clear.
“The board has clarified its stand on the matter in the March 28 meeting, and we have nothing to add to it,” Kochhar said at the ICICI Bank press meet on Monday after its earnings announcement.
Kochhar has been under scrutiny over loans to debt-laden Videocon Group as the appliance maker’s promoter Venugopal Dhoot had links with a company founded by her husband Deepak Kochhar. The country’s second-largest private lender’s board came out in support of the CEO expressing “full faith” in her leadership in an effort to dispel allegations of nepotism and quid pro quo.
On whether an independent third-party probe will be allowed into the matter, Kochhar said the bank had supported all investigative authorities and cooperated with them, and shall continue to do so.
ICICI Bank’s profitability took a hit in the quarter ended March as bad loans and provisions rose after the Reserve Bank of India overhauled its stressed asset resolution mechanism.
Edited excerpts of Chanda Kochhar’s conversation with journalists:
Has the board, at any point, discussed bringing in an interim CEO or laid out a succession plan in the event of a change in leadership?
The board has made its stand very clear in the March 28 meeting and as far as the operations of the bank are concerned, you can see the stability in the enhancement of franchise and the results.
Would you stay on till the end of your term in March 2019? Is that a given?
Well, I think today we are talking about the fourth quarter results, and we haven’t talked about any CEO’s tenure during the results presentation before.
This time, the investor confidence in ICICI Bank seems to be shaken not due to asset quality issues, but due to the perceived loopholes as far as corporate governance is concerned. Is this something that will be taken up in the board meeting tomorrow?
Tomorrow’s board meeting is a usual meeting that happens every year at the year-beginning wherein we discuss the strategy, budget and planning for the coming year. So tomorrow’s meeting is one of a similar nature.
Multiple questions have been raised in recent times with regard to disputes at the ICICI Bank board. Do you think it is prudent for an MD and CEO to step back in such a case and allow for an outside investigation to conclude and then hold chair?
One, the board has made its stance very clear, and two, ICICI Bank has fully cooperated with all the regulatory and investigative agencies in any matter, and we would continue to do so.
It’s been over a month since the board has been clarifying, yet there is no confidence build-up on the matter, and the issue of a third-party audit keeps cropping up. What do you suggest on that front?
The board has said we cooperate fully with all regulatory and investigative agencies, and will continue to do so.
Has this been a difficult period for you in the light of mounting allegations?
I think a professional must focus on his/her job.
You said the board would not be taking up the Videocon controversy at the meeting tomorrow. Why is that so, at a time when it’s crucial for shareholders to get a clear picture? Does the board plan to revisit the matter anytime soon?
As of now, I’ll repeat what I’ve said before....that the board has made its stand very clear.