Within months of taking charge, India’s largest private sector lender faced the Reserve Bank of India’s wrath. In December 2020, the regulator barred HDFC Bank from issuing new credit cards and launching new digital initiatives after repeated outages in its internet and mobile banking services. The bank took 15 months to resolve the issues and emerge from the restrictions.
Jagdishan’s biggest business challenge came with the merger of HDFC Ltd with HDFC Bank, effective July 1, 2023 — the biggest amalgamation in the Indian banking sector. The merger created a funding challenge for the bank: HDFC Bank inherited HDFC Ltd’s large loan book without a commensurate deposit base, pushing its credit-deposit ratio to about 110 per cent. The bank was subsequently forced to moderate loan growth and step up deposit mobilisation, weighing on growth and shareholder returns.
The business challenges then moved into the realm of governance when part-time chairman Atanu Chakraborty resigned in March this year, saying certain happenings and practices within the bank were “not in congruence” with his personal values and ethics. Chakraborty had served as chairman since May 2021 and had been reappointed for a three-year term from May 2024.
HDFC Bank later said independent legal reviews by Wilson Sonsini Goodrich & Rosati and Wadia Ghandy & Co. found no evidence to substantiate Chakraborty’s allegations. The bank appointed former finance secretary and former chief election commissioner Rajiv Kumar as its new part-time chairman in June this year.
Another governance issue emerged around the bank’s dealings with the Maharashtra State Road Development Corporation (MSRDC). In May this year, The Indian Express reported that an internal vigilance investigation had found that about ₹45 crore was paid to MSRDC during 2023-24 and 2024-25 through marketing expenses classified as “differential interest”. HDFC Bank denied any wrongdoing.
Following an internal review of the bank’s arrangements with MSRDC to garner deposits in 2017 and 2021, the board in July issued warning letters and imposed a ₹1 lakh penalty each on Jagdishan, Chief Financial Officer (CFO) Srinivasan Vaidyanathan, and Group Head-Retail Assets Arvind Vohra. The board concluded that the lapse was not mala fide and amounted to business overreach rather than misconduct.
The matter, however, escalated. In August, two law firms filed a proposed federal securities class action in a US district court against HDFC Bank and two of its executives over alleged illegal payments to MSRDC to induce large deposits.
HDFC Bank’s Dubai operations also continued to face scrutiny. In August this year, more than 75 clients who had purchased Carlisle Luxembourg Life Fund through the bank’s Dubai operations were planning to approach the Prime Minister’s Office, the Reserve Bank of India, and overseas regulators over alleged mis-selling, losses, and delayed redemptions.
Against this backdrop, Jagdishan told the HDFC Bank board in August that he did not wish to seek reappointment and would retire at the end of his current term on October 26. The bank is now accelerating the search for his successor.
Jagdishan joined HDFC Bank in 1996 as a manager in the finance function and became business head-finance in 1999. He was appointed CFO in 2008 and, in 2019, was made the bank’s “strategic change agent”. Before becoming MD and CEO, he was group head, overseeing finance, human resources, legal and secretarial, corporate communications, infrastructure and administration, and corporate social responsibility.
Jagdishan has 33 years of overall experience. He holds a bachelor’s degree in science with a specialisation in physics, is a chartered accountant, and has a master’s degree in economics of money, banking, and finance from the University of Sheffield, UK.
Jagdishan may not be directly responsible for many of the issues that cropped up at the lender during his tenure. But his decision to step down closes a six-year chapter at HDFC Bank marked by regulatory restrictions, a historic merger, and a series of governance and compliance challenges.
Timeline | 6 years, 6 turning points
October: Jagdishan takes over as HDFC Bank MD and CEO, succeeding Aditya Puri
December: RBI bars bank from issuing credit cards and launching digital initiatives after repeated outages
May: RBI imposes ₹10 crore penalty over auto-loan sourcing and other compliance lapses
August: RBI lifts credit card ban
March: RBI lifts restrictions on digital launches
July: HDFC Ltd merges with HDFC Bank in India’s largest banking merger
June: Lilavati Kirtilal Mehta Medical Trust files FIR naming Jagdishan, alleging receipt of ₹2.05 crore in connection with an attempt to influence trust’s affairs
September: Dubai Financial Services Authority bars HDFC Bank’s Dubai International Financial Centre branch from onboarding clients over findings linked to Credit Suisse AT1 bond sales and compliance failures
* Part-time chairman Atanu Chakraborty resigns, citing practices “not in congruence” with his personal values and ethics
* HDFC Bank dismisses three senior executives after an internal probe into alleged mis-selling of Credit Suisse AT1 bonds to NRI clients through its Dubai operations
May: The Indian Express reports an internal vigilance probe found about ₹45 crore was paid to MSRDC during FY24 and FY25 through marketing expenses classified as “differential interest”. HDFC Bank denies wrongdoing
June: HDFC Bank says independent legal reviews found no evidence to substantiate Chakraborty’s allegations; appoints former finance secretary Rajiv Kumar as part-time chairman
July: Board warns Jagdishan, CFO Srinivasan Vaidyanathan, and group head-retail assets Arvind Vohra, and imposes ₹1 lakh penalty on each over MSRDC arrangements; calls lapse business overreach, not misconduct
* Two law firms file a proposed US securities class action against HDFC Bank and two executives over alleged illegal payments to MSRDC
* More than 75 clients who bought Carlisle Luxembourg Life Fund through HDFC Bank’s Dubai operations plan to approach Indian and overseas regulators over alleged mis-selling, losses, and delayed redemptions
* Jagdishan tells board he will not seek reappointment and will retire on October 26
