3 min readMay 28, 2026 06:00 AM IST First published on: May 28, 2026 at 06:00 AM ISTAn investigation in this newspaper has revealed that HDFC Bank, India’s largest private-sector bank by assets and market capitalisation, “camouflaged” crores of rupees as marketing spend to pay higher interest to the Maharashtra State Road Development Corporation, a public limited company fully owned by the Government of Maharashtra. The investigation found that on March 12 this year, HDFC’s Audit Committee of the Board (ACB) ordered a formal “Internal Vigilance Investigation” into payments totalling Rs 45 crore made to the MSRDC during FY2024 and FY2025. This money was meant as “differential interest”, that is, interest over and above the specified rate, on the MSRDC’s deposits in the bank. But instead of being credited directly to the MSRDC’s account as interest earned, the money was routed through the bank’s marketing department, disguised as contributions to a road safety awareness campaign through four local vendors.Notably, six days after this probe was first ordered within HDFC, its chairman, Atanu Chakraborty, resigned abruptly, citing “certain happenings and practices within the bank” not in “congruence” with his personal values and ethics. At that time, Chakraborty’s resignation did not raise alarm bells, with both the interim chairman, Keki Mistry, as well as the RBI saying that there was no evidence of any misconduct. The fact is, the bank’s top brass were aware of the Rs 45-crore payment, which, according to its own vigilance probe, violates RBI rules and the bank’s code of ethics. It is now clear that key management personnel were fully aware of the “differential interest” being routed through the marketing department as payments for a road safety campaign by the MSRDC in a bid to attract hefty deposits from the government agency. According to the Banking Regulation Act, banks cannot give a negotiated rate to any one customer.AdvertisementThis episode raises several questions of corporate governance in HDFC Bank. One, why did it promise an interest rate higher than what was permissible? Two, why did it resort to routing the money via its marketing department? While these questions should be probed, the role of the MSRDC itself is not beyond suspicion, starting with its alleged demand for an upfront fee of Rs 5 crore from HDFC Bank. More importantly, it is not clear where the Rs 45 crore went. If HDFC gave that money for a road safety campaign to four vendors, what happened to the original promised interest payment? If it came to the MSRDC as interest payment through the regular channel, what about the Rs 45 crore that HDFC gave for the road safety campaign?