Big setback for ICICI Bank in Chanda Kochhar case; here is what has happened now

With ICICI Bank embroiled in a controversy over alleged conflict of interest involving its CEO Chanda Kochhar, market regulator Sebi has begun looking into the matter for any possible disclosure and corporate governance-related lapses. Besides, Videocon Industries and its promoters have come under the regulator's scanner as the matter relates to alleged "quid pro quo" involving loans to the company by a group of lenders, including ICICI Bank and some public sector banks.

The markets watchdog has begun a preliminary enquiry into various disclosures made by the top private sector bank over the last few years while the stock exchanges may seek additional clarifications regarding recent reports in this regard that relate to dealings that took place way back in 2012, a senior official said.

ICICI Bank is India's fourth most valued bank with a market capitalisation of about Rs 1.8 lakh crore and its shares are also part of the benchmark stock market index Sensex.

ICICI Bank's board has reposed full faith in Kochhar, while sources close to them said that regulatory queries were satisfactorily answered in 2016 as no conflict of interest was found at that time about the loans given to Videocon, that too as part of a consortium.

"I would like to clearly state that we always satisfactorily reply to questions of regulators," ICICI Bank Chairman M K Sharma said on Thursday but did not specifically name any regulator.

Sources, however, said that the RBI had sought clarification from the bank in 2016 on the issue to which the bank had given its response at that time.

Earlier this week, some media reports mentioned about alleged involvement of Kochhar and her family members in a loan provided to Videocon group on quid pro quo basis. Concerns were also raised about transactions of Videocon group and NUPower Renewables, a company operated by her husband Deepak Kochhar.

The lender has come out in defence of Kochhar saying its board has full faith and confidence in Kochhar.
"The board has come to the conclusion that there is no question of any quid pro quo/ nepotism/ conflict of interest as is being alleged in various rumours. "The board has full confidence and reposes full faith in the bank's MD and CEO Chanda Kochhar," Sharma said on Thursday.

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He had also said that it was not the lead bank for this consortium and the bank only sanctioned its share of facilities aggregating approximately Rs 3,250 crore which was less than 10 per cent of the total consortium facility in April 2012.