HDFC Bank initiates internal probe into alleged data leak by two senior executives

HDFC Bank has initiated an internal enquiry into the alleged leak of confidential information of the country’s biggest private sector lender by two senior executives.

According to sources, the internal review was initiated after senior executives flagged concerns over potential information leaks.

Investigators are examining whether the information disclosed was misused, sources said.

Acknowledging an internal review on the matter, a spokesperson of HDFC Bank said, “The bank is committed to upholding the highest standards of ethics and governance as outlined in our Code of Conduct. We take any report of potential violations seriously.”

In line with the bank’s policies, the spokesperson said, an internal review into this matter is currently underway to gather and evaluate all relevant facts.

“To protect the integrity of the process and the privacy of all parties involved, we do not comment on active internal reviews. Appropriate action will be taken based on the findings, once the review is complete,” the spokesperson added.

The probe comes a week before former head of ICICI Prudential Life Anup Bagchi takes charge as the MD and CEO of the systemically important lender. He is going to be the first outsider to become the head of the bank.

Mr. Bagchi, will succeed Sashidhar Jagdishan, who informed the board in August that he would not seek reappointment when his term ends on October 26.

Mr. Jagdishan took over as the CEO of the bank in 2020 from Aditya Puri, who had led the bank since its inception in 1995.

Within months, it announced the merger of its mortgage major parent, HDFC, with itself, leading to huge expansion in the asset book and worries over business performance, HDFC liability payouts and compressed net interest margins of the combined entity.

The issue of Mr. Jagdishan’s reappointment has been a subject of intense speculation, especially after the surprising resignation of non-executive chairman Atanu Chakraborty in March this year, citing concerns on ethics and governance practices at the lender.

In late July, the bank board found shortcomings in the deposit arrangements with the Maharashtra State Road Development Corporation (MSRDC) and also slapped a fine of ₹1 lakh each on Jagdishan and other key executives, even though it said that their actions were not mala fide.

It was alleged that the bank paid, over and above the card rate, for getting high-value deposits from the state-run body and routed them as marketing spends.

Besides, the bank has also faced allegations of mis-selling Credit Suisse’s AT-1 bonds to diaspora clients from its Dubai DIFC branch, which led the local regulator to prohibit the bank from onboarding new customers or conducting new business last year.