An ICICI Bank ATM in New Delhi. Photo: Reuters
An ICICI Bank ATM in New Delhi. Photo: Reuters

The board of India’s largest private-sector bank, ICICI Bank, is likely to discuss the controversy surrounding its chief executive officer Chanda Kochhar and the involvement of her spouse and close relatives in a corruption and nepotism case.

Some directors on the ICICI Bank board are likely to meet soon to discuss the way ahead for the CEO, with investigating agencies probing the business dealings of her husband Deepak Kochhar and her brother-in-law Rajiv Kochhar, reports Economic Times.

The Central Bureau of Investigation (CBI) is inquiring into allegations of corruption and nepotism related to loans given by ICICI Bank to the Videocon Group, a consumer-electronics and oil and gas exploration company with which Deepak Kochhar had a business partnership.

The CBI has questioned Rajiv Kochhar over alleged conflict of interest after it emerged that his Avista Advisory also advised clients of ICICI Bank.

The bank’s board had met on March 28 and said it had faith and confidence in Chanda Kochhar. However, since that meeting there have been more developments, including the interrogation of her relatives by the CBI and a lookout circular regarding her and some of her family members to prevent their using airports without notifying authorities.

ICICI Bank and its CEO are facing allegations of conflict of interest, unprecedented in an Indian private-sector bank, regarding its business dealings between members of Kocchar’s family and Videocon.

Chanda Kochhar has maintained silence and the board has said she was not directly involved in the loans of 32.5 billion rupees (US$500 million) provided to Videocon in 2012, which were approved by a credit committee headed by then-chairman K V Kamath.

The controversy broke after the Indian Express daily reported that Videocon promoter Venugopal Dhoot had formed NuPower Renewables Pvt Ltd as a joint venture with Deepak Kochhar, lent him 640 million rupees and transferred ownership of the lending entity to him for just 900,000 rupees.

This transfer happened six months after the Videocon Group got a loan from ICICI Bank. Almost 86% of that loan – 28.1 billion rupees – remains outstanding and the Videocon account was declared a non-performing asset in 2017.

This controversy comes close on heels of the infamous Punjab National Bank scam in February involving a fraud of around $2 billion.