HDFC Bank Shares Decline Nearly 3% Amid Reports of SEBI Review of Ex-Chairman's Exit Letter and Jefferies Exit

HDFC Bank Shares Decline Amid SEBI Review of Former Chairman's Resignation

HDFC Bank shares declined by 3% on Friday due to reports that the Securities and Exchange Board of India (SEBI) is reviewing the resignation letter of former part-time chairman Atanu Chakraborty.

The stock's decline follows consecutive sessions of gains and reached an intraday low of Rs 759.25 per share on the NSE, down 2.95%. This comes after SEBI initiated a preliminary review of Chakraborty's resignation letter for possible violations of rules governing directors of listed companies, according to sources.

Jefferies, a global brokerage, has exited its holdings in HDFC Bank shares while trimming its India weightage shortly after Chakraborty resigned from the board. The stock had previously fallen by 8.7% in the following session after the letter surfaced, eroding about Rs 1.35 lakh crore in market capitalisation over three sessions.

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SEBI is examining the role of the former chairman and other directors for alleged lapses in fiduciary duties. The examination aims to verify claims made in the resignation letter and whether other directors were aware of any material information and did not document them.

HDFC Bank has appointed external law firms to independently assess the concerns raised in the resignation letter. However, Chakraborty stated that the firms had not contacted him. The review by SEBI is ongoing, and its outcome may impact the stock's performance in the future.