EXECUTIVE SUMMARY. Two long serving senior executives of HDFC Bank who headed important business verticals have abruptly quit the bank, reportedly under unusual circumstances. Abhay Aima (Group Head – Private Banking), quit sometime in FY2020, while Ashok Khanna (Group Head – Secured Vehicle Loans) left in early FY2021. Aima, who had worked with Aditya Puri in Citibank, joined HDFC Bank in January 1995 (Puri joined the bank as CEO in September 1994) and was “a strong pillar for HDFC Bank’s private banking business”. Khanna joined in June 2002 and the automobile loan business he headed was around 8% of the bank’s total loans in FY2020 and was the second largest component of retail loans. On social media, it is alleged that their departure was unusual. HDFC Bank, despite professing to maintain high standards of transparency, has declined to provide any clarity in response to queries posed by this writer.
Normally, when a senior, long-serving official leaves, the concerned individual sends an email to colleagues, and the bank also broadcasts that the individual has left, and names the successor who will replace the individual. But for both Aima and Khanna’s exits, as per social media, HDFC Bank did not inform their own staff about the departures.
What is also dismaying, but on expected lines, is that the business media have collectively decided to ignore the departures of both these senior executives. Aima was a regular on business TV and was interviewed on issues pertaining to the capital market, while Khanna was the public face of the bank for automobile loans. Even though prominent journalists from mainstream business platforms (such as Business Standard, CNBCTV-18, and Bloombergquint) were tagged on Twitter in mid-June regarding Aima and Khanna’s departures, none of these media platforms published stories informing their viewers of the abrupt departures of two long serving senior HDFC Bank executives, nor did they conduct any investigation of the circumstances of their exits.
It is a sad commentary on the state of the business media that they failed, or rather declined, to cover this story on India’s number 1 bank by market capitalisation (with significant foreign institutional investor ownership). The lack of media coverage was despite the fact that it was virtually given to them. For the mainstream business media, prominent companies that probably advertise on their platforms and grant them corporate access in the form of “exclusive interviews” are perhaps far more important than their own viewers. They mete out favourable treatment to prominent companies to insulate them from any adverse coverage. Sell-side analysts as usual have also ignored this significant development. Such is the state of India’s capital market.
I, Hemindra Hazari, am a commentator on Indian banks, economy and the capital markets. Views expressed in this Insight accurately reflect my personal opinion about the referenced securities and issuers and/or other subject matter as appropriate. I own HDFC Bank equity shares.