ICICI Bank backs Chanda Kochhar after report alleges conflict of interest in loans given to Videocon
The lender issued a clarification after a report raised questions about a deal between the husband of the bank’s CEO and Videocon CEO Venugopal Dhoot.
ICICI Bank on Wednesday clarified “there is no question of any quid pro quo/nepotism/conflict of interest” following a report that made these allegations against the bank for sanctioning loans to the Videocon Group. The loans were sanctioned after the Indian conglomerate’s Chief Executive Officer Venugopal Dhoot and Deepak Kochhar – the husband of ICICI Bank Managing Director and Chief Executive Officer Chanda Kochhar – founded a company.
In a stock exchange filing, the bank’s board said it “reposes full faith” in Chanda Kochhar, and that “malicious and unfounded rumours” were being spread to “malign the bank”.
“No individual employee, whatever may be his or her position, has the ability to influence the credit decision at the bank,” the bank said.
The clarification comes after The Indian Express raised questions of propriety and conflict of interest and sent a questionnaire to ICICI Bank on its findings.
According to the report, Dhoot set up a company with Deepak Kochhar and two other relatives of Chanda Kochhar in December 2008. He then gave a loan of Rs 64 crore to this firm through an entity he fully owned before transferring its ownership to a trust headed by Deepak Kochhar for just Rs 9 lakh, The Indian Express reported.
An investigation by the newspaper found that Dhoot had transferred ownership of the company to Deepak Kochchar six months after ICICI Bank granted the Videocon Group a Rs 3,250-crore loan. The Indian Express report said that nearly 86% of this loan – Rs 2,810 crore – is still unpaid, and the Videocon account was declared a non-performing asset in 2017.
The newspaper also quoted unidentified officials as saying that investigative agencies were looking into the transactions involving Videocon, the Kochhars and ICICI Bank.