Chanda Kochhar, the CEO of India’s second-largest private lender and one of a handful of powerful female industry leaders in the country, has quit around six months after getting embroiled in a nepotism scandal.
On Oct. 04, ICICI Bank notified the BSE that it had accepted Kochhar’s request for an early retirement, effective immediately. Sandeep Bakhshi, formerly CEO of its insurance subsidiary, ICICI Prudential Life, will take over as managing director and CEO, ICICI Bank said in a regulatory filing (pdf). In June, ICICI Bank appointed Bakhshi whole-time director and chief operating officer to manage the company.
Kochhar’s departure comes around two years after a whistleblower first accused her of nepotism and favouritism in granting a loan to NuPower Renewables, a company established by her husband, Deepak Kochhar. The whistleblower’s letter was sent to prime minister Narendra Modi, but resurfaced on a blog in March this year, placing Kochhar right in the eye of the ensuing storm.
While ICICI Bank first refuted the allegations, it was soon forced to launch an independent probe,after the Central Bureau of Investigation and the Securities and Exchange Board of India began inquiries against Kochhar and the company. In the meantime, Kochhar went on planned leave.
The increased scrutiny came amidst the Indian banking sector’s struggle with a mountain of bad debt and a series of embarrassing banking scams that wiped out billions of dollars. In this context, the accusations against Kochhar were too serious to ignore.
Her move marks a bitter end to the reign of a handful of successful women in the Indian banking sector. Over the past year, the industry has seen a number of key female leaders fall from grace, including Usha Ananthasubramanian, CEO of the public sector Allahabad Bank, and others who were forced to step down following tenures marred by weakening profitability.