Mumbai: Under the scrutiny of multiple agencies for alleged lapses in corporate governance, ICICI Bank has now come under the lens of US market regulator SEC.
The Securities and Exchange Commission’s (SEC) queries centre on ICICI’s dealings with certain borrowers under CEO Chanda Kochhar, Bloomberg reported quoting people familiar with the matter.
The report further said SEC has asked whether there had been misrepresentations in the bank’s accounting. ICICI Bank has American Depository Receipts (ADRs) traded in the US.
Kochhar, who faces serious charges of quid pro quo in dealings with Videocon Group, has gone on leave.
The bank has appointed Justice BN Srikrishna, a retired Supreme Court judge, to head an independent enquiry into allegations raised by a whistleblower against Kochhar.
The private lender had given Rs 3,250 crore loans to Videocon whose chairman Venugopal Dhoot co-founded a separate firm, NuPower Renewables, with Deepak Kocchar, husband of ICICI Bank’s CEO. There was some possible quid pro quo in the grant of loans, a letter by the whistleblower had alleged. The loans are now non-performing asset on bank’s books.
A whistleblower has twice floated allegations against Kochhar for allegedly bestowing undue favours on Essar Group’s Ruia brothers for ‘round-tripping’ investments into her husband Deepak’s NuPower Group. All parties named in the whistleblower’s second letter to the prime minister have denied the allegations as baseless and malicious.
The Securities and Exchange Board of India (Sebi) last month had issued a showcause notice to Kochhar for alleged violation of disclosure requirements under securities law. According to Sebi, Kochhar didn’t adhere to the code of conduct, which required the disclosure of any conflict of interest in the case involving Videocon Group and NuPower Renewables.
ICICI Bank had said in 2012 a consortium of over 20 banks and FIs sanctioned facilities to the Videocon Group (Videocon Industries and 12 of its subsidiaries/associates as co-obligors) for a debt consolidation.
