Bharucha (60) joined the board of the bank in 2014 and is the longest-serving executive board member.
According to norms of the Reserve Bank of India (RBI), a wholetime director’s tenure, with the tenure of the CEO covered under this, is capped at 15 years. For Bharucha to have a full term of three years, some relaxation from the RBI is required.
“Bharucha can certainly be considered. He has almost two and a half years left, and it is not unusual for the RBI to allow six months’ relaxation so that he has a full three-year term,” said a source close to the development.
A career banker with more than 39 years’ experience, Bharucha has been an integral part of HDFC Bank since its inception. He co-chaired and spearheaded the Integration Committee, which was tasked with the responsibility of ensuring complete integration for the smooth merger of HDFC and the bank. The merger came into effect on July 1, 2023.
“The Board decided to fast-track the process for selection and appointment of his successor well within time,” HDFC Bank said while announcing Jagdishan’s decision.
The bank’s “Governance, Nomination and Remuneration Committee” (GNRC), chaired by Harsh Kumar Bhanwala, who is former chairman of the National Bank for Agriculture and Rural Development, will be on a war-footing to find a successor because there are less than two months before Jagdishan demits office.
“The GNRC shall have to search, shortlist and then recommend to the Board names of the potential successor, and the Board will then have to send at least two names to the RBI for its approval,” said Rikin Shah, analyst with IIFL Capital, in a note. “The potential shortlists can be a combination of both internal and external candidates.”
Banking sources indicated that ICICI Prudential Life Insurance MD & CEO Anup Bagchi, Tata Capital’s MD & CEO Rajiv Sabharwal and CSB Bank’s Pralay Mondal, who holds the same designations, could be in contention.
Bagchi, an alumnus of IIT-Kanpur and IIM-Bangalore, joined the ICICI group in 1992, and has the experience of working in various sectors, including retail banking, corporate banking, and treasury.
Sabharwal had served as executive director on the board of ICICI Bank. An alumnus of IIT-Delhi and IIM-Lucknow, he previously served as partner at True North Managers LLP and as chairman of ICICI Home Finance Company.
Mondal has been in his present job since September 2022. Mondal, an alumnus of the IIT-Kharagpur and IIM-Calcutta, had 12 years’ stint at HDFC Bank. He also worked with Axis Bank and Yes Bank.
He has about 30 years of banking experience across multiple business and functions, including retail assets, retail liabilities, business banking, products and technology.
“The bank may also consider any other internal or external candidate who could serve for a longer period. We think a credible external candidate can provide a clean leadership reset and can be anyone from sitting CEO of private banks, former CEOs / senior bankers, a younger second-line CEO/CXOs,” Shah added.
While CEOs in private banks such as Yes Bank and Bandhan Bank in recent times saw appointment from the public sector , in HDFC Bank’s case it is likely the new CEO will be from the private sector if the bank decides to go for an external candidate.
