Chanda Kocchar, Videocon case and test of “ना खाऊंगा ना खाने दूंगा”

Some interesting stories have unfolded in the Indian Banking and Financial Sector in last 1-2 months. First, there was the Nirav Modi and Punjab National Bank scam, and since then many Banking frauds or scams are coming in light.

But there is one peculiar story that is still not being seriously pursued. Few days ago there was a news that the Top two ladies at the two leading private banks in India have been summoned by SFIO (Serious Fraud Investigation Office). Usually the bank officials from the concerned branch are called for such questioning. So it was a bit surprising to see that the CEOs were called. One of them happened to be ICICI Bank’s CEO Chanda Kocchar.

Then last week some stories broke out in few lesser known media, individual blogs that Chanda Kocchar was caught in a dubious deal involving Videocon group and her husband’s joint venture where ICICI Bank (headed by Chanda Kocchar) lent large sums of loan, and eventually Videocon was declared as Non Performing Asset (thereby helping her husband’s JV).

The story was not picked up by any major newspaper or TV media until this week. It was said in hush-hush manner that the case has been referred to the Prime Minister’s Office (PMO) and the PMO is sitting on the file but not willing to act. Some suggested that it is going to be a major test of Prime Minister’s motto, which he used to brag about often (but not much of late!), “ना खाऊंगा ना खाने दूंगा” – Won’t take bribe myself and won’t let others take

It is indeed a sad situation that such high profile cases are not pursued in transparent manner and politics and electorate convenience always takes over.

You should remember that Chanda Kocchar was among the top bankers who had praised the monumental blunder of Demonetization. She had called it a “gamechanger” !?

Just yesterday the ICICI Bank board announced that they back Chanda Kocchar amid nepotism rumors. See how conveniently the case has been transformed from a fraud to a nepotism issue!

Let’s see how the case unfolds and who pursues it. I have a major investment in ICICI Group companies, mainly because of their track record and sound corporate governance. But now I am not sure if they do have such high standards – in fact, does anybody else in India can claim to have highest Corporate Governance standards? We have seen the mighty fall of Satyam Computers. We have seen internal squabbles at Tata Group (Mistry vs Ratan Tata), we have seen similar power struggle in Infosys (Narayana Murthy vs Vishal Sikka). All these were reputed firms/groups who seemed so fragile once these issues came to surface.

So now one cannot be 100% sure that any business house or company or person is infallible.

In my view the Chanda Kocchar “scam” or “nepotism” issue is going to blow into a major controversy soon, and the Prime Minister Narendra Modi will be under pressure to act in this matter. Not sure if he is willing to…given the fragile state of Indian Banking Sector and the reputation of Chanda Kocchar.

Update: 31st March 2018:

CBI has registered preliminary inquiry into the Videocon-Kochhar case. Let’s see how this shapes up. How much of politics and how much of genuine inquiry/investigation…



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