Avoid insinuations without evidence, says SEBI Chief on HDFC Bank chairman’s exit

Tuhin Kanta Pandey
| Photo Credit:
FRANCIS MASCARENHAS

Insinuations without evidence should not be made, said SEBI Chief Tuhin Kanta Pandey commenting on HDFC chairman Atanu Chakraborty’s statements on ethical practices in the bank before he resigned abruptly.

Addressing the media Q4FY26 board meeting, he said: “You just can’t say anything and go; you have to substantiate.” He further highlighted the responsibilities of independent directors in matters of actual or suspected fraud. 

At the board meeting, SEBI decided to approve key recommendations of the High Level Committee on Conflict of Interest, which submitted its report four months back.  

According to the board, the recommendations include bringing chairperson and whole time members of the board within the definition of ‘insider’, establishment of digital systems for conflict-of-interest management and a new office of ethics and compliance to oversee the public issues. SEBI also recommended notifying a separate set of regulations for board members and an oversight committee on ethics to oversee board members. 

Another major regulatory change was to simplify ‘fit and proper person’ guidelines for intermediaries which include depositories, clearing houses and exchanges, operating in the capital market. Accordingly, members of intermediaries will be disqualified only on conviction for economic offences or securities law violation. However, disqualification on conviction will also include offences involving moral turpitude, among others. 

The board also decided that Foreign Portfolio Investments (FPIs) will now be allowed to settle funds on a net basis for stock market transactions. From now onwards, the payment for a stock that FPIs buy will be adjusted with the proceeds of the stock it sells, the board said. Earlier, FPIs had to pay for the stock they buy in full and receive payment for the stocks they sell. At a time when FPI outflows have crossed ₹88,000 crore in March 2026 alone, Mr. Pandey assured new FPI registrations continued in response to measures easing their operations and reducing cost. 

The board also brought reduced /minimum investment value for social impact funds in Alternative Investment Funds—pooled investment vehicle for HNI—to ₹1,000 from the existing ₹2 lakh, to enhance retail participation. 

SEBI also introduced measures to ease winding up and surrendering of registrations and addressing practical concerns.