An internal probe at HDFC Bank, India’s largest lender, found that two senior executives were allegedly disclosing confidential information to outsiders. According to an exclusive Bloomberg report, the individuals possibly revealed confidential business strategies and market-sensitive information.
"An internal review into this matter is currently underway to gather and evaluate all relevant facts", an HDFC spokesperson said, adding that appropriate action would be taken based on the findings of the investigation. The bank also said it was committed to upholding the highest standards of ethics and governance and takes reports of potential violations seriously.
The bank started an investigation after some leaders raised suspicion about the possibility of an information leak. Citing people familiar with the matter, Bloomberg reported that the probe and its findings were reported to the senior management and some board members earlier this year.
These executives reportedly oversee key businesses and functions at the bank. The senior executives were informed of the investigation findings, though it was unclear what disciplinary action, if any, would be taken.
The review findings add to the number of challenges for the next CEO, Anup Bagchi, who used to be part of the rival ICICI Group. This includes the increased number of internal divisions inside the lender’s bank.
The leadership change was initiated after Sashidhar Jagdishan, the chief executive, decided not to seek another term, which ended on October 26, 2026. Jagdishan’s term was highly controversial, marked by events including HDFC's merger with its parent, India’s largest housing finance company, in 2023. In March, Chair Atanu Chakrabory also resigned, citing ethical differences with the bank.
The bank made headlines after Jagdishan, CFO Srinivasan Vidyanatha and group head Arvind Vohra were fined for offering interest rates to a government client. The lender is currently facing a US securities class action lawsuit for disguising ₹45 crore in interest deposits as marketing expenses. The bank also announced that Kaizad Bharucha is stepping down as Deputy Managing Director by the end of the calendar year.
The bank’s recent Q2 results for FY27 also disappointed the stock market. Despite quarterly net profit jumping 5.2 per cent to ₹19,509.96 crore (from ₹18,641.28 crore), the bank’s net interest margin fell to its lowest level in 12 quarters, declining 10 basis points (bps) year-on-year to 3.16 per cent. Its share price has declined about 28 per cent this year.
