HDFC Bank has concluded an internal investigation into its dealings with the Maharashtra State Road Development Corporation (MSRDC), resulting in disciplinary action against three senior executives, including Managing Director and CEO Sashidhar Jagdishan.

The bank's Board, at a meeting held on July 23, 2026, accepted the recommendations of a Special Disciplinary Committee comprising independent directors. The review examined the bank's arrangements for mobilising deposits from MSRDC during 2017 and 2021.

The committee did not find sufficient evidence to establish that the employees involved had acted with bad faith, sought personal financial benefit or had any improper intention. However, it concluded that their conduct amounted to what the bank described as "business overreach".

Following the committee's recommendations, the bank decided to issue formal warning letters and impose a monetary penalty of ₹1 lakh each on Jagdishan, Chief Financial Officer Srinivasan Vaidyanathan and Group Head – Retail Assets Arvind Vohra.

Warning letters were also issued to the other employees involved in the matter. HDFC Bank said the findings would be shared with the Reserve Bank of India, particularly in view of any possible divergence from applicable RBI guidelines.

What Is the MSRDC Issue?

The review relates to allegations that emerged earlier this year concerning HDFC Bank's dealings with MSRDC.

Media reports in May alleged that the bank had made payments totalling ₹45 crore to the state infrastructure body in connection with efforts to secure substantial deposits. The payments were reportedly recorded as marketing expenditure, with reports also suggesting that senior bank management was aware of the arrangement.

HDFC Bank had previously rejected allegations of wrongdoing and maintained that it operates under established systems of internal controls, audits and oversight. The bank had said that any concerns were addressed through its existing governance mechanisms.

The latest action follows the completion of the internal review and the Board's acceptance of the independent committee's findings.

Separate Review Into Former Chairman's Concerns

The development also comes against the backdrop of another independent legal examination concerning concerns raised by former HDFC Bank chairman Atanu Chakraborty.

Chakraborty stepped down from his position in March 2026. A subsequent legal review, according to the bank, found no evidence or documented basis to substantiate the ethical and governance issues that had been raised in connection with his departure.

The bank's latest disciplinary action therefore marks the conclusion of its review into the MSRDC deposit arrangements, with the Board drawing a distinction between conduct it considered to be excessive in pursuit of business and actions involving deliberate wrongdoing or personal gain.