Videocon loan case: Chanda Kochhar will have to return bonuses worth Rs 9.8 crore to ICICI Bank

After the indictment of former ICICI Bank CEO Chanda Kochhar by Justice BN Srikrishna Committee in the Rs 3,250 crore loan case, the former top banker will have to give back bonuses worth over Rs 9.82 crore, accumulated in the course of 10 years since 2009, to ICICI Bank. Justice Srikrishna panel, appointed by the internal audit committee of ICICI Bank to probe violations in the loans disbursement to Venugopal Dhoot-led Videocon Group, submitted the report to the ICICI Bank board on Wednesday. The report clearly said Chanda Kochhar violated the bank's code of conduct, following which the bank has decided to clawback all bonuses paid to the former top executive during her tenure as its CEO and Managing Director since April 2009.

A close look at the ICICI annual reports during these years suggest Chanda Kochhar was paid bonus that varied from Rs 20.6 lakh in FY18 to a maximum of Rs 2.2 crore in FY17. She, along with other top directors of the private lender, decided to forgo their bonuses for the financial year 2016 due to a 13 per cent decline in the bank's profit that year. The annual reports say Chanda Kochhar received Rs 26.9 lakh as a performance bonus in 2010; Rs 82.8 lakh in FY11, Rs 1.2 crore in FY12; Rs 1.79 crore in FY13; Rs 1.5 crore in FY14; Rs 1.6 crore in FY15; Rs 2.2 crore in FY17; and Rs 20 lakh in FY18. All these bonuses amount to over Rs 9.8 crore.

Following the Srikrishna panel report, the ICICI Bank board has said it will revoke Chanda Kochhar's all existing and future entitlements, including unpaid bonuses, medical benefits, and stock options. Chanda Kochhar received 2.1 lakh shares every year between FY10 and FY12. She also got 2.5 lakh shares in FY13; 14.5 lakh in FY14; 14.5 lakh in FY15; 15.9 lakh in FY16; 15.1 lakh each in FY17 and FY18, respectively.

The Employee Stock Option Scheme (ESOPs) of ICICI Bank allows a maximum of 0.05 per cent of issued shares in a stock option to any employee in a financial year. Chanda Kochhar had proceeded on leave after an enquiry was announced against her over the allegations of quid pro quo in the loan sanctioning process to the Videocon Group. She resigned from the bank in October 2018. For the financial year 2018, Chanda Kochhar received Rs 6.58 crore as annual compensation, including Rs 3 crore as basic salary.

Also read: ICICI Bank finds Chanda Kochhar guilty, will take back bonuses paid since 2009; ex-CEO 'shocked, hurt'

The panel report also ratifies the Central Bureau of Investigation's (CBI) FIR registered on January 22 against Chanda Kochhar that said she helped Videocon by sanctioning loans amounting to Rs 1,575 crore, which led to a wrongful gain to borrowers. The CBI had also asked for a probe into the role of its current CEO Sandeep Bakhshi, and former top bosses Zarin Daruwala and KV Kamath as they were part of the ICICI committees that sanctioned the loans to the Videocon group.

Meanwhile, Chanda Kochhar has issued a statement, saying she is "utterly disappointed, hurt and shocked by the decision" of the ICICI Bank board. "I have not been given a copy of the report.  I reiterate that none of the credit decisions at the bank is unilateral. ICICI is an institution with established robust processes and systems which involve committee based collective decision making with several professionals of high calibre participating in the decision making. Hence the organisation design and structure obviate the possibility of a conflict of interest."

Also read: Will ICICI Bank Board take responsibility of giving clean chit to Chanda Kochhar in March last year?