SEBI Chair Pandey flags board governance in HDFC Bank case; maintains status quo on F&O

Speaking on the sidelines of the SEBI Board meeting during a Q&A session, Chairman Tuhin Kanta Pandey addressed both governance concerns around the recent developments at HDFC Bank and the regulator’s stance on derivatives trading.Commenting on the resignation of HDFC Bank’s Chairman, Atanu Chakraborty, the SEBI chief underscored the importance of institutional processes and transparency at the board level. He noted that independent directors are required to adhere to a defined code of conduct and that any concerns must be formally recorded in the minutes of board meetings.

He added that if there are issues, they should be reflected through proper channels, cautioning that no insinuations should be made without formal documentation. His remarks come amid efforts by the bank and regulators to reassure stakeholders that there are no material concerns regarding governance or operations.
HDFC Bank has maintained that there are no regulatory or operational issues linked to the exit, while the Reserve Bank of India has also indicated that the bank remains financially sound with a professionally run board.

F&O: Status quo for now

On the derivatives segment, the SEBI chairman indicated that there is no change in the regulator’s current approach towards futures and options (F&O) trading. He said the regulator will continue to collect and analyse data till March before considering any further steps.In an exclusive conversation with CNBC-TV18, earlier this month, Pandey had reiterated that SEBI has already implemented multiple measures over the past year to curb excessive speculation, particularly in short-duration and weekly options, where activity had surged significantly. These include tighter position limits, upfront margin requirements, expiry-day norms and enhanced monitoring mechanisms.

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He added that the regulator is currently in a ‘wait and watch’ mode, assessing the impact of these interventions before deciding on any additional reforms in the F&O space.