ICICI Bank CEO and Managing Director Chanda Kochhar may have been asked to go on indefinite leave pending an independent enquiry to probe “conflict of interest” allegations against her regarding loans extended to Videocon Group, according to a report in Mint.
“The decision to ask Kochhar to go on leave has been taken on the advice of a majority of the seven independent directors on the bank’s board,” Mint quoted an unnamed source.
Moneycontrol could not independently verify the report.
However, in a notification to exchanges, the country’s largest private bank said, “The ICICI Bank Board denies having asked Ms. Chanda Kochhar to go on leave. She is on her annual leave which was planned in advance. Further, the Board denies that it has appointed any search committee to find her successor.”
Further, the Mint report claimed that an enquiry, likely to be headed by a retired Supreme Court judge, will begin next week and will be completed over the next two months.
Kochhar has led ICICI Bank since 2009 and her third term is due to end in March 2019.
Allegations of impropriety against her were first raised in October 2016 by an ICICI Bank shareholder, who alleged a quid pro quo on Kochhar’s part as ICICI Bank had granted loans to Videocon Group, whose promoter Venugopal Dhoot had investments in NuPower Renewables, which is owned by Chanda’s husband Deepak Kochhar.
The whistleblower had written a letter to the Finance Ministry, Prime Minister’s Office (PMO), Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI) and various investigation agencies including the Central Bureau of Investigation (CBI).
Following the letter, ICICI Bank said that it had conducted an internal probe, but did not find any merit in the allegations.
However, in March end, the allegations came into the spotlight yet again worrying shareholders, investors, depositors and other stakeholders.
On May 30, ICICI Bank received another complaint, following which it announced an independent enquiry would be initiated to examine the merit of the “conflict of interest” allegations against its CEO.
Currently, market regulator SEBI is probing the matter and Reserve Bank of India (RBI) has not yet disclosed if any action would be taken on the issue.
So far, the bank’s board has fully backed its CEO and denied any wrongdoings while sanctioning loans to Videocon Group, which is now a defaulter or a non-performing asset (NPAs) in most banks.
So far, the Bank’s CEO has refused to comment on any disclosures made before the board or her involvement in granting the loans to the Videocon group.
Prasanta Patnaik