RBI Asks HDFC Bank To Put Two Board Appointments On Hold
A HDFC Bank branch in Mumbai, India. (Photographer: Vijay Sartape/BloombergQuint)

RBI Asks HDFC Bank To Put Two Board Appointments On Hold

HDFC Bank Ltd. said the Reserve Bank of India has asked it to reconsider two key appointments to its board.

On Nov. 28, the nation’s largest private lender had intimated exchanges about the appointment of Sashidhar Jagdishan and Bhavesh Zaveri as additional director and executive director (whole-time director), respectively.

Jagdishan, earlier the chief financial officer at the bank, was appointed the ‘change agent’ in August 2019. That was seen as a sign that he may be one of the internal contenders to succeed Aditya Puri as managing director and chief executive officer.

Zaveri was country head of operations at the private lender.

The proposed appointments to the board have been put on hold for now, the bank informed exchanges on Wednesday.

HDFC Bank “has received communication from RBI stating that since these are important positions in the bank, the bank is advised to examine and submit the proposal after a new MD and CEO assumes charge later this year,” it said in the statement. The bank shall accordingly ensure compliance with the RBI’s instruction, it said.

Puri is set to retire on Oct. 26, 2020. HDFC Bank has set up a search committee but is yet to zero in on candidates. Global search firm Egon Zehnder has been appointed to help the panel, with Puri also acting as an adviser.

RBI rules will push HDFC Bank to finalise names of potential successors by the end of June. In a March 31 notification, the RBI asked banks to submit names of two contenders in the order of preference at least four months before the term of the incumbent CEO expires.

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