India-based private sector lender HDFC Bank has carried out a probe into its vehicle-financing operations for improper lending practices, reported Bloomberg.
The results of the probe have not been shared with the public.
An internal audit of the unit uncovered some issues and alleged conflicts of interest with regard to the acquisition of global positioning systems for HDFC-financed vehicles.
The bank had also decided against a proposal of extending the employment contract of the vehicle financing unit’s head Ashok Khanna after the probe was completed, said the people to the news agency.
HDFC’s management team earlier considered a proposal to retain Khanna as the unit’s head until October 2020.
This was to ensure business continuity ahead of the retirement of HDFC Bank’s managing director Aditya Puri later this year.
A spokesman for HDFC Bank said that Khanna, who had been receiving extensions since 2017, retired at the end of March as per his contract.
The unit, which had outstanding loans of over $16bn as of 31 March, represents over 10% of the bank’s total loan book.
In an email, the spokesman said: “The bank has a well-established process of investigating every complaint that it receives and takes actions as appropriate. In the said instance as well, the bank has followed the due process.”