HDFC Bank Looks To Headhunters For Jagdishan’s Successor

HDFC Bank is looking to appoint a search firm to speed up the selection of its next chief executive after Sashidhar Jagdishan decided not to seek another term, according to a Bloomberg report.

The Mumbai-based lender has held talks with headhunters including Egon Zehnder, with discussions gaining pace after Jagdishan’s decision was announced on Saturday, the report said. Jagdishan, who has spent nearly three decades at HDFC Bank, will step down on October 26.

The bank could appoint a search firm as early as this week as it looks for potential candidates. The board will also need regulatory approval for the new CEO, who could be chosen from within the bank or brought in from outside, according to the report.

Kaizad Bharucha Among Internal Contenders

HDFC Bank Deputy Managing Director Kaizad Bharucha has emerged as the strongest internal contender, alongside other senior executives, according to the report. Bharucha currently oversees retail and wholesale banking and has spent around three decades at the lender.

However, his potential appointment could face a regulatory constraint. Bharucha has served on HDFC Bank’s board for 12 years, while Reserve Bank of India rules cap the continuous tenure of a CEO or whole-time director at 15 years.

As a result, if Bharucha is selected, he may not be able to complete a full three-year term, the report said. This could be an important consideration as HDFC Bank weighs internal and external candidates for the top job.

New CEO Faces Investor Confidence Test

he next CEO will take charge at a difficult time for HDFC Bank, with the lender’s shares down 28% this year, compared with a 4% decline in the benchmark Nifty Bank index. The new leadership will therefore be expected to help strengthen investor confidence.

Jagdishan’s decision also ends months of speculation over whether he would seek an extension. His departure comes after a period of heightened scrutiny at the bank, including the exit of former chairman Atanu Chakraborty in March.

Chakraborty had resigned citing concerns over certain happenings and practices at the bank. HDFC Bank later conducted an independent legal review, which it said found no evidence supporting his allegations and pointed to inconsistencies in his statements. With Jagdishan now set to leave, the lender’s search for his successor could become a key test for its board and investors.