In the wake of the sudden resignation of HDFC Bank chairman Atanu Chakraborty, citing ethical concerns, the lender has terminated three senior executives for deficiencies in client onboarding at its Dubai International Financial Centre (DIFC) branch.
Sources indicate that the dismissals are linked to the alleged mis-selling of Credit Suisse’s Additional Tier-1 (AT-1) bonds, an issue that had previously drawn regulatory scrutiny. Following the allegations, the Dubai Financial Services Authority (DFSA) prohibited HDFC Bank from onboarding new clients at its DIFC branch in September 2025, highlighting lapses in compliance and due diligence.
When approached for comment, HDFC Bank issued a statement confirming that it had identified “certain gaps in client-onboarding requirements” at the DIFC branch and conducted a thorough, objective review of the matter. The statement added:
“Appropriate remedial actions have been taken in line with internal policies. Personnel changes have been undertaken along with actions in accordance with the bank’s conduct regulations. HDFC Bank remains committed to upholding the highest standards of governance and regulatory compliance.”
Details of Executive Dismissals
| Executive | Position | Reason for Termination |
|---|---|---|
| Executive 1 | Senior Executive | Mis-selling of AT-1 bonds |
| Executive 2 | Senior Executive | Gaps in client onboarding |
| Executive 3 | Senior Executive | Breach of conduct regulations |
The firings follow closely on the heels of Chakraborty’s resignation, which took effect on 18 March 2026. This marked the first instance of a part-time chairman leaving mid-term, raising concerns about the bank’s governance and internal functioning. In his resignation letter dated 17 March, Chakraborty explained:
“Certain happenings and practices within the bank over the last two years are not in congruence with my personal values and ethics. There are no other material reasons for my resignation beyond this.”
Chakraborty, a 1985-batch IAS officer of the Gujarat cadre, joined HDFC Bank as part-time chairman on 5 May 2021, nearly a year after retiring as the Secretary of the Department of Economic Affairs. His tenure had been extended in 2024 for an additional three years, until 4 May 2027.
He assumed leadership during the reverse merger of HDFC Bank with its parent, HDFC Limited, a prominent mortgage firm in India. The merger, effective 1 July 2023, created a financial giant with a combined balance sheet exceeding ₹18 lakh crore, significantly expanding HDFC Bank’s domestic and international footprint.
HDFC Bank emphasised that it will continue to maintain stringent governance practices, robust compliance mechanisms, and adherence to regulatory requirements, underscoring its commitment to both investor and client protection amid ongoing scrutiny.