Why HDFC Bank has fined its CEO, CFO ₹1L each
What's the story
HDFC Bank has imposed a fine of ₹1 lakh each on its Managing Director and CEO Sashidhar Jagdishan, Chief Financial Officer Srinivasan Vaidyanathan, and Group Head-Retail Assets Arvind Vohra. The penalty comes after an internal review of the bank's deposit arrangement with the Maharashtra State Road Development Corporation (MSRDC) in 2017 and 2021. The board deemed their actions as "business overreach," not malicious intent or personal gain.
Board decision
Board met on July 23, reviewed findings
The bank's board met on July 23, 2026, and reviewed the findings of a Special Disciplinary Committee of Independent Directors.
They concluded that the employees' conduct was "business overreach," not mala fide action or personal gain.
However, considering possible divergence with RBI directions and based on committee recommendations, the board decided to issue warning letters and impose a fine of ₹1 lakh each on Jagdishan, Vaidyanathan, and Vohra.
Regulatory compliance
Warning letters issued to other employees involved
Along with the fines, warning letters were also issued to other employees involved in the case.
The board has also directed that this matter be reported to the Reserve Bank of India (RBI).
This decision comes after an investigative report alleged that HDFC Bank had made payments to MSRDC as part of a scheme to attract large deposits from the state agency.
Allegations refuted
Payments booked as marketing expenses
The payments in question were reportedly booked as marketing expenses, making it look like the money was being spent to incentivize the department to park funds with the bank.
However, HDFC Bank had strongly denied these allegations at the time.
"The bank has robust internal oversight, audit and control processes and systems," it said in a statement today.