ICICI Bank CEO Chanda Kochhar faces max R 25 crore fine if found guilty

Mumbai, June 11: The Securities and Exchange Board of India (Sebi) has powers to impose a penalty but not demand the resignation of ICICI Bank Ltd chief executive Chanda Kochhar if it finds she and the bank did not abide by fair disclosure norms in its ongoing probe. A maximum penalty of R25 crore, or three times the ill-gotten gains, can be levied under Sebi rules, but in this case, the quantum of the penalty may be at the discretion of Sebi’s adjudicating officer, according to two executives familiar with the development. “Only a financial penalty can be levied as under the current notice, there is no provision for asking the CEO to step down,” said the first of the two executives, both of whom spoke on the condition of anonymity. On 24 May, Sebi sent a notice to ICICI Bank and Kochhar, seeking clarification with regard to disclosure of price-sensitive information from the bank and the CEO allegedly not abiding by the bank’s code of conduct. Emails sent to ICICI Bank and Sebi seeking comment on Friday went unanswered. “The show cause to Chanda Kochhar alleges that she did not adhere to the bank’s code of conduct as far as making disclosures… Considering that the CEO’s husband (Deepak Kochhar) had a partnership with a firm owned by the promoter (Venugopal Dhoot) of Videocon group, and some of the group’s companies in turn secured loans from the bank, these disclosures should have been made as part of Sebi’s rules on LODR (Listing Obligations and Disclosure Requirements),” said the second executive. (Agencies)