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ICICI Bank has highlighted the risks to its business from enquiries into its MD and CEO Chanda Kochhar’s loan dealings as well as a second enquiry into NPA loan accounts in its annual Form 20 F filing to the Securities and Exchange Commission (SEC). It has said that it is in the process of responding to the SEBI showcause notice.
"The bank is in the process of responding to the relevant allegations in the notice (from SEBI) which pertain to the bank. The Central Bureau of Investigation also initiated a preliminary enquiry against various individuals and firms, including unknown officers and/or officials of the bank,” it informed the US markets regulator, adding that the allegations were levelled against Kochhar through media articles, a whistleblower complaint and complaints written by a private individual to senior government officials and regulators.
The lender also informed the SEC of the second whistleblower complaint it received in March 2018 of irregular transactions in borrower accounts.
“The bank has reviewed certain additional accounts for any similar irregular transactions as alleged in the complaint. Based on the interim report and review undertaken for additional loan accounts, the bank has concluded that the likely impact of these allegations is not material to the financial statements for the year ended March 31, 2018 or earlier periods reported in this annual report,” it said in the filing.
ICICI Bank also said it has has voluntarily complied with all requests of the SEC investigatory staff for information and interviews related to the bank’s US GAAP loan impairment process. This is the first time the lender has come on record on a number of allegations levelled against it since March this year.
Meanwhile, in a separate notice for its annual general meeting, ICICI Bank disclosed the remuneration for its new Chief Operating Officer, Sandeep Bakhshi, who has been appointed in the place of Kocchar, as she is on a leave of absence until the investigation is completed.
Bakhshi’s salary for 2018-19 would be Rs 4.81 crore, which would include a monthly basic salary of Rs 23.81 lakh and a supplementary allowance of Rs 16.32 lakh. In contrast, Kochhar had a salary of Rs 6.4 crore in 2017-18. ICICI Bank AGM is scheduled for September 12.
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