HDFC Bank is likely to name Deputy Managing Director Kaizad Bharucha as one of two options for its next CEO after incumbent Sashidhar Jagdishan retires at the end of his second term in October, two people familiar with the matter said.
India's largest private lender is also searching for an external candidate in keeping with a central bank rule requiring banks submit multiple names for the CEO position, the people said, declining to be identified as the information was private.
The Reserve Bank of India approves top banking appointments.
Also Read: HDFC Bank CEO search tests investor confidence, governance
Neither HDFC Bank nor Bharucha responded to emails seeking comment outside of regular business hours.
The CEO search comes after about six months of upheaval at HDFC Bank where leadership issues have weighed on its shares.
The bank announced Jagdishan's retirement on Saturday. He had been widely tipped to continue as CEO before Atanu Chakraborty resigned as chairman in March saying practices at the bank were at odds with his "personal values and ethics".
An external legal review found no evidence to substantiate Chakraborty's governance concerns.
Last month, the board penalised Jagdishan and two others in a separate matter related to the pricing of large deposits.
The bank said on Saturday without elaborating that its CEO since October 2020 had decided not to seek reappointment and that it would fast-track the appointment of a successor.
Also Read: HDFC Bank CEO Sashidhar Jagdishan to step down in October
Among the leading internal candidates is Bharucha, a long-serving executive overseeing the retail and wholesale businesses, the people said.
Bharucha is not due to retire until 2029, when he will have been a full-time director for 15 years, making him eligible to be CEO under RBI rules. The maximum tenure of a so-called whole-time director is 15 years, though exemptions can be sought.
The price of HDFC Bank shares, which were about 40% foreign-owned as at June-end, has fallen 27% this year, with the decline accelerating after Chakraborty's departure.
Investors have also voiced concern over the lack of gains from a 2023 merger overseen by Jagdishan with then-parent HDFC Ltd.
