HDFC Bank has submitted to the Reserve Bank of India (RBI) the names of two candidates for the position of managing director and CEO, setting in process the next occupant of the chair which hopefully will rock the country’s largest private lender back to normalcy.

Though the names have not been revealed, the speculation is that it consists of an executive from within HDFC Bank and an external candidate.    

The bank said in a regulatory filing that the proposed appointment, including the remuneration, will be for three years.

The RBI’s prior approval is needed for the appointment of the heads of private-sector lenders.

The move comes after Sashidhar Jagdishan, the current MD & CEO, decided not to seek a third term and will retire on 26 October. The 61-year-old HDFC Bank veteran had taken charge of the CEO post in October 2020.

Jagdishan’s term came under indirect attack in March when part-time chairman Atanu Chakraborty abruptly resigned, citing concerns over ethics and governance. A series of developments have hit the bank, including deposit arrangements with the Maharashtra State Road Development Corporation (MSRDC) and allegations of mis-selling of Credit Suisse AT-1 bonds to diaspora clients through its Dubai DIFC branch. 

HDFC Bank’s shares have also underperformed peers, after the merger with mortgage lender HDFC Ltd in 2023 expanded the bank’s asset book significantly and put pressure on deposit mobilisation to bring in the balance.

Ahead of the appointment of a new CEO, the bank’s board approved the reappointment of V Srinivasa Rangan as a Whole-time Director, designated as Executive Director, for a year from 23 November to 22 November 2027.

The board also approved the appointment of Jimmy Tata as a Whole-time Director, designated as Executive Director, for three years from the date of RBI approval or any other date or period specified by the central bank. Tata currently serves as HDFC Bank's Chief Credit Officer.

Bharucha is already a Whole-time Director on the bank's board.

The bank will also create one more Whole-time Director position, taking the total number of Whole-time Directors on its board to four, apart from the MD & CEO.

The lender said the additional position is aimed at providing sharper synergy and oversight, including over its subsidiaries, while creating a larger pipeline for succession planning.

The new position will be filled in consultation with the incoming MD & CEO after the new chief takes charge.

The bank said the required shareholder approvals for the appointments will be sought in due course.

It further stated that none of the candidates are related to each other or to any other director or Key Managerial Personnel of the bank. It also said they are not debarred from holding the office of a director under any SEBI order or any other authority.