ICICI Bank to probe CEO Chanda Kochhar’s dealings involving certain borrowers

Earlier on May 24, the Securities and Exchange Board of India (Sebi), issued notice to the bank and Kochhar for alleged non-compliance of the listing agreement in the Videocon case which relates to dealings involving the Videocon group and NuPower Renewables.

By: ENS Economic Bureau | Mumbai | Updated: May 30, 2018 4:58:14 pm

Kochhar attended an event in Mumbai titled India Economic Summit

ICICI Bank MD and CEO Chanda Kochhar. (file photo)

ICICI Bank on Wednesday said that its board has decided to institute an “enquiry” into a fresh complaint received from an anonymous whistleblower alleging non-adherence of code of conduct, conflict of interest and quid pro quo by the bank’s CEO Chanda Kochharwhile dealing with certain borrowers of the bank.

The bank said the enquiry will be headed by an “independent and credible person” and would be “comprehensive”. It said the independent enquiry will use forensics, review emails and record the statements of the relevant personnel. “The enquiry would also cover all connected matters in the course of the investigation to bring the matter to a final close,” said the bank in a filing to the exchange.

“In keeping with the Whistle Blower Policy of the bank, Board has mandated its audit committee to take all further actions in the matter to operationalise this decision-including in particular, appointment of an independent and credible person as head of enquiry, determining the terms of reference of the enquiry, the period which will be covered by the enquiry etc.,” the bank said.

Earlier on May 24, the Securities and Exchange Board of India (Sebi), issued notice to the bank and Kochhar for alleged non-compliance of the listing agreement in the Videocon case which relates to dealings involving the Videocon group and NuPower Renewables, an entity in which Deepak Kochhar spouse of the bank’s MD and CEO, has economic interests.

As first reported by The Indian Express, Videocon group promoter Venugopal Dhootprovided crores of rupees to NuPower Renewables Pvt Ltd (NRPL), a firm he had set up with Deepak Kochhar and two relatives six months after the Videocon group got Rs 3,250 crore as loan from ICICI Bank in 2012. He transferred proprietorship of the company to a trust owned by Deepak Kochhar for Rs 9 lakh, six months after he received the loan from ICICI Bank. Almost 86 per cent of the Rs 3,250 crore loan (Rs 2,810 crore) remained unpaid. The Videocon account was declared an NPA in 2017.

The bank admitted that Chanda Kochhar did not recuse herself from a credit committee meeting which decided to grant the loan to the Videocon group in 2012. In April, M K Sharma, the bank’s chairman, had said the bank had satisfactorily replied to all the questions of the regulators.

The CBI initiated a preliminary enquiry into the matter to check any wrongdoing, while other agencies, including the Enforcement Directorate, also opened investigations. The bank’s board stood firmly behind Chanda Kochhar, saying no wrong was committed by the MD and CEO. It said the loan was underwritten in accordance with the bank’s credit standards and was extended as part of a consortium involving over 20 banks.

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