No governance issues found, says RBI Guv Malhotra on HDFC Bank

Mumbai: The Reserve Bank did not come across any governance or conduct-related issues during supervisory inspection of HDFC Bank, Governor Sanjay Malhotra said on Wednesday.

Responding to a question at the post-monetary policy press conference on sudden resignation of HDFC Bank Chairman Atanu Chakraborty and subsequent fall in its share price, Malhotra said Reserve Bank had also seen minutes of meetings of the lender, and the RBI did not find any thing of material concern.

He said the RBI in its press release on March 19 too had said there were no material concerns on record as regards the bank’s conduct or governance.

“HDFC Bank is a Domestic Systemically Important Bank (D-SIB) with sound financials, professionally run board and competent management team. Basis our periodical assessment, there are no material concerns on record as regards its conduct or governance,” the Reserve Bank said in its press release.

Chakraborty had resigned on March 18.

Malhotra also asserted that India’s banking system is “very resilient, safe, and strong”.

He said there is no systemic risks with regard to profitability and health of banks amid the West Asia conflict.

To another question, the Governor indicated that the low interest rates regime may continue for long.

He also said measures recently taken by the RBI to check volatility of rupee will not remain forever.