HDFC Bank chose an outsider. What happens to the insider who was not chosen?

HDFC Bank chose an outsider. Its insider is leaving.

Written on 21 October 2026, based on public reports at that time.

In September, HDFC Bank’s board sent two names to the RBI for the top job.

One was Kaizad Bharucha. He joined the bank in 1995 and has been on its board since 2014. The board credits him with building the bank’s credit framework.

The other was Anup Bagchi, who has spent his whole career in the ICICI group.

The RBI approved Bagchi. He takes charge later this month as the bank’s first CEO from outside.

On Saturday, the bank told the exchanges that Bharucha has asked to step down at the end of December.

The reported reason is technical. RBI rules cap a whole-time director’s continuous tenure at 15 years. His would run out in 2029, before a full new term could end. That may well be the whole story.

But anyone who has sat through a succession will recognise the pattern. The board spends months deciding who gets the chair. Very little time goes on what happens to the person who does not.

And the runner-up is rarely an ordinary employee. He is usually the one who knows the history behind every big decision, and which customer needs a call before they leave. When he goes, a lot of the institution’s memory goes with him. Often in the new CEO’s first year, exactly when it is needed most.

I see the same thing in family businesses, only quieter. The elder son is made MD. The younger one, who ran the factory for fifteen years, starts “taking a break”. Or a professional CEO is hired, and the finance head who built every system resigns three months later.

If your business will choose a successor in the next few years, do this before anything is announced. For every name on the shortlist, write down what their role will be if they are not chosen. Then have that conversation with each of them privately, well before the news is public.

Succession has two outcomes. Most boards plan only one of them.