HDFC Bank Rejects Allegations In ₹45 Cr MSRDC Payment Report

HDFC Bank on Wednesday strongly rejected media reports alleging wrongdoing in a ₹45 crore payment matter linked to the Maharashtra State Road Development Corporation (MSRDC). The bank said it follows strong internal oversight, audit and control systems and deals with all issues as per established processes.

“We strongly reject any assumptions of wrongdoing or culpability based on selective material,” an HDFC Bank spokesperson told Reuters.

The clarification came after a media report said HDFC Bank’s Audit Committee had initiated a formal internal vigilance probe into alleged payments worth ₹45 crore made to a PSU that were reportedly shown as marketing expenses.

What Report Claimed

According to report, an internal audit of HDFC Bank’s marketing department for FY25 had flagged the transactions and rated the department’s functioning as “unsatisfactory”.

According to a The Indian Express investigation report cited by The Economic Times, the ₹45 crore payments were allegedly linked to MSRDC and routed through four local vendors under a road safety awareness campaign.

The report claimed the money was meant to compensate MSRDC through differential interest payments. However, instead of being directly credited as interest income, it was allegedly routed through the bank’s marketing expenses and shown as marketing spend.

Senior Executives Named

The Indian Express report said discussions regarding the payments allegedly took place in the presence of HDFC Bank MD & CEO Sashidhar Jagdishan.

The report cited testimonies from officials involved in the internal probe, claiming Jagdishan participated in calls where compensating MSRDC through the marketing budget was discussed as a one-time arrangement.

It also reported that Chief Marketing Officer Ravi Santhanam allegedly stated during the vigilance probe that the marketing department acted as a facilitator in routing the payments.

Regulatory Issues Highlighted

The The Indian Express report further alleged that the arrangement may have violated Reserve Bank of India (RBI) rules that prohibit banks from offering negotiated returns to individual depositors outside approved structures.

It also flagged possible breaches of the bank’s anti-bribery and anti-corruption policy, saying routing such payments through vendors could qualify as improper inducement.

Shares of HDFC Bank were down about 2.52% on NSE at 2:43 pm following the bank's response.