ICICI Bank Fines Bijapurkar For 'Inadvertent Trade' Two Days After She Quit As Director
Bijapurkar, who serves on the boards of Mahindra & Mahindra Financial and Nestle India, resigned Jan. 20.
ICICI Bank Ltd. has fined independent director Rama Bijapurkar for inadvertently purchasing shares of the private lender during a 'closed period'. The bank said this in an exchange filing soon after it disclosed that Bijapurkar had resigned from the board for other reasons.
Bijapurkar, who also serves on the boards of Mahindra & Mahindra Financial Services Ltd. and Nestle India Ltd., among others, tendered her resignation on Jan. 20, according to the bank's filing. The bank's management had informed her about a potential conflict of interest arising from her other professions as a teacher and researcher.
"My teaching activity in the area of market and business strategy at an educational institution and my research activities on India's consumer economy at a not-for-profit research centre which may require me to occasionally engage with other financial service companies or the investor community, could be in violation of the conflict of interest policy of the bank and the regulator," Bijapurkar wrote in her resignation. That, she said, was despite no direct remuneration being earned.
Bijapurkar said she was resigning in order "to avoid any possible ambiguity" on her position at any future date as a result of these activities. Her resignation is effective Jan. 23.
On Jan. 22, the bank informed stock exchanges that there had been an "inadvertent" trade by Bijapurkar. "Her independent financial adviser purchased 4,900 equity shares of the bank in her account without prior intimation to her when the trading window was closed, on Jan. 5, 2022."
Companies prohibit top management and board members from transacting in their shares prior to any important news event, in this case quarterly earnings. ICICI Bank's quarterly earnings were approved by its board and disclosed to stock exchanges on Jan. 22.
The audit committee of the bank fined Bijapurkar Rs 2 lakh for the infraction, but ruled that there was no intent to violate the bank's Code on Prohibition of Insider Trading or the SEBI (Prohibition of Insider Trading) Regulations, 2015.
In response to BloombergQuint's queries, Bijapurkar said the two events are "completely unrelated" and that she is complying fully with the Rs 2-lakh penalty.
ICICI Bank appointed Vibha Paul Rishi as additional (independent) director for five years. Rishi has worked with Titan Co., PepsiCo, Max India, Future Group and serves on several boards.