MUMBAI: HDFC Bank is understood to have terminated the services of half a dozen executives following irregularities in the auto loans business. The bank had earlier admitted that following an internal investigation into allegations of irregularities in this segment, it had taken disciplinary action against staff.
There have been reports in mainstream and social media on the bank bundling purchase of global position system (GPS) devices along with auto loans. The ministry of road transport and highways had made it mandatory to install vehicle location-tracking in all public vehicles, while it is optional for private cars.
Last week, Bloomberg carried a report linking exit of the bank’s former auto loan head Ashok Khanna with the probe into allegations of improper lending practices and conflicts of interests in its vehicle-financing operation. Speaking at the bank’s annual general meeting on Saturday, the bank’s MD & CEO Aditya Puri said, “Internal inquiries carried out in the matter based on whistle-blower complaints received have brought out no conflict of interest issue. The inquiry did bring out other aspects related to personal misconduct, aggravated by a set of employees in the auto loan business for which appropriate disciplinary actions have been taken.”
He added that Khanna, being head of the business segment, had also participated in the inquiry process. “There is absolutely no correlation or unnecessary correlation between the state of our portfolio or any losses or anything of the sort. Khanna was to retire after a one-year extension and he retired in March,” said Puri.