…ICICI board asks Kochhar to remain on leave

Ivan Schwartz
June 19, 2018

The bank on May 30 announced that its Board has chose to institute a "comprehensive enquiry" to look into an anonymous whistleblower's complaint alleging that Kochhar had not adhered to provisions relating to "code of conduct" of the bank.

It isn't clear when Justice Srikrishna will submit his report. "Without second-guessing the ICICI Bank board, we wonder under what circumstances the three-tier structure at the bank might be collapsed to two, as a COO role strikes us as unnecessary in the long term", said Jefferies in a report on ICICI Bank. N.S. Kannan, the bank's chief financial officer under Kochhar, is being airlifted to the group's life-insurance venture whose CEO is being parachuted into the mothership to help steady it. Reports suggest that he is unlikely to opt for another term.

ICICI's directors, however, had painted themselves into a corner by a premature defence of their CEO, who was feted just months ago as one of India's top female bankers and a role model. Kannan is the bank's executive director.

Bakhshi started his career with the ICICI group in 1986 and has looked after the group's corporate, retail lending and insurance businesses.

Bakhshi has been the Managing All Executive Directors on the Board of ICICI Bank and the executive management will report to Bakhshi.

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The directors tried to soften the blow by saying in a statement that Bakhshi will report to Kochhar.

The bank, in the statement, said: "In line with the highest levels of governance and corporate standards, Chanda Kochhar has chose to go on leave till the completion of the enquiry as announced on May 30, 2018". Removing Kochhar barely months after going out on a limb in her defence would make directors vulnerable to legal attacks from the bank's American depositary receipt holders. He claimed that the ICICI Bank had favoured Ruia brothers of Essar group for "round-tripping" investments into Chanda Kochhar's husband Deepak Kochhar's NuPower Group - the same firm involved in Videocon loan case. The bank on its part has clarified that Chanda Kochhar was part of the credit committee meeting which evaluated the Videocon loan in 2012.

The bank has been in focus due to conflict-of-interest allegations by a whistle blower against Kochhar over loans to Videocon Industries which she has denied.

2009: Kochhar takes over the reins at ICICI Bank in May. It's unclear what led to this move, but questions are raised on the board's hasty decision to clear Kochhar of all charges without a probe. The ICICI Bank stock on Monday closed up 3.61 percent or 10.2 rupees at Rs 292.5 at the BSE, prior to the board's decision.

Other reports by GizPress

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