Deepak Parekh is likely to step down as the executive chairman of Housing Development Finance Corporation (HDFC) by the end of the year. He is expected to take over as the non-executive chairman of the country's largest mortgage player.
In a statement, HDFC on Wednesday said that Parekh's tenure, which was due to end on February 28 has been extended till December 31, 2009. The extension is subject to shareholder approval.
When contacted, Parekh told Business Standard that the HDFC board would take up the issue of the appointment of a new chairman during the last quarter of 2009. "There will be continuity in the process," he said.
Sources at the institution said that as per the original plan, Parekh had expressed his desire to take up a non-executive role. They said the move would be similar to the developments at ICICI Bank where Managing Director and CEO K V Kamath would assume the non-executive chairman's role from May 1.
"It is entirely up to him (Parekh). We expect him to take over as the non-executive chairman," said a source.
After Kamath and Axis Bank Chairman P J Nayak, Parekh could be the third high-profile banker who has expressed his intent of giving up an executive role this year.
While the succession plan at ICICI Bank has been implemented, Axis Bank is looking for a non-executive chairman as well as a candidate to take over as the Managing Director and CEO.
The three key executives have been instrumental in shaping the financial institutions they have headed.
Parekh gave up a job abroad to join HDFC in 1978. Parekh is a qualified charted accountant from England and worked with Ernst & Young, Precision Fasteners, ANZ Grindlays and Chase Manhattan.
He was inducted as a whole-time director of HDFC in 1985 and was appointed Chairman in 1993.
During his term, HDFC has spread its wings across the financial sector with subsidiaries dealing with banking (HDFC Bank), insurance (HDFC Standard Life) and mutual fund (HDFC Mutual Fund), among others with the group's total assets estimated at over Rs 94,000 crore.