HDFC Bank chief executive Sashidhar Jagdishan has decided not to seek another term and will step down when his current tenure ends on October 26, the bank said on Saturday.
Jagdishan had been expected to seek a third term as the head of India’s largest private-sector bank. The bank’s board said it would speed up the process of selecting his successor.
“Mr Jagdishan reiterated his decision to not seek reappointment. Accordingly, he shall retire from the services of the bank upon the close of business hours on October 26, 2026,” HDFC Bank said in a filing with the stock exchanges.
The announcement comes months after Atanu Chakraborty resigned as the bank’s part-time chairman in March, citing ethical differences. His departure had raised concerns among investors over the bank’s internal governance.
HDFC Bank subsequently ordered an external legal review. The review, completed in June, found no evidence to support the concerns raised by Chakraborty.
The bank appointed former bureaucrat Rajiv Kumar as its chairman in July.
Jagdishan was also among three senior executives penalised by the bank’s board in July. The board took action after concluding that employees involved in deciding deposit rates for a state government agency had gone beyond accepted business practices.
Last month, HDFC Bank reported a 5 per cent increase in profit for the April-June quarter, helped by stronger consumer lending and a fall in the amount set aside to cover possible bad loans.
The bank earned a standalone net profit of Rs 19,060 crore during the quarter, compared with Rs 18,150 crore during the same period last year. Analysts had expected a profit of about Rs 19,190 crore.
Its total loans increased by 15.4 per cent from a year earlier, driven mainly by housing loans, personal loans and other retail lending. Deposits grew by 13.3 per cent.
The Net Interest Income, which is the difference between what the bank earned from loans and paid as interest to depositors, rose by 6.7 per cent to Rs 33,530 crore.
However, the bank’s lending margin remained at 3.26 per cent, below the 4 per cent recorded before HDFC Bank merged with its parent company, HDFC, in 2023. Investors have been watching this figure to assess whether the Rs 3.3 lakh crore merger is delivering the expected benefits.
Gross non-performing loans as a share of total loans edged up to 1.17 per cent from 1.15 per cent in the previous quarter. This means there was a marginal increase in the proportion of loans on which borrowers had stopped making repayments.
Meanwhile, provisions and contingencies fell 78 per cent from a year earlier to Rs 3,060 crore. This is the money the bank sets aside to cover possible losses from bad loans and other risks.
Income from fees, government bonds and other market operations fell 41 per cent from the previous quarter to Rs 12,821 crore. Rising bond yields and Reserve Bank of India restrictions on certain foreign-exchange transactions affected this part of the bank’s earnings.