HDFC Bank has rejected the lawsuit as without merit and said it will vigorously defend itself.
Soneji filed the proposed class action on August 13, 2026, in the US District Court for the Southern District of New York against HDFC Bank, managing director and CEO Sashidhar Jagdishan and CFO Srinivasan Vaidyanathan. Summonses were issued on August 14.
The proposed class covers investors who purchased or otherwise acquired HDFC Bank securities between July 17, 2023 and May 26, 2026.
The complaint alleges violations of Sections 10(b) and 20(a) of the US Securities Exchange Act.
What the lawsuit alleges
At the centre of the complaint are alleged payments of about ₹45 crore to MSRDC. The plaintiff alleges that the payments were routed through HDFC Bank’s marketing function and presented as sponsorships for a road-safety campaign, while effectively allowing MSRDC to earn an interest rate higher than the rate otherwise available on its deposits.
The complaint alleges that the arrangement resulted in an effective interest rate of 6.01%, including an additional 2.51 percentage points, and that the bank failed to adequately disclose the arrangement and related risks to investors.
The allegations are based on claims made in the lawsuit and have not been adjudicated by the court.
From internal review to US litigation
The lawsuit follows an internal review by HDFC Bank into the MSRDC transactions.
In July, the bank’s board described the conduct as “business overreach” and imposed warnings and financial penalties on three senior executives in connection with the matter.
The MSRDC controversy had surfaced publicly in May following reporting on an internal vigilance investigation into the payments.
The developments also prompted three US law firms to announce investigations into whether HDFC Bank may have violated US securities laws or made misleading disclosures to investors.
The August 13 filing now takes the matter a step further, moving it from law-firm investigations into formal court litigation.
HDFC Bank response
HDFC Bank said shareholder lawsuits of this nature are common in the US.
“In the United States, these types of shareholder lawsuits are incredibly common after a company experiences a stock drop, and many companies listed in the US routinely defend these lawsuits each year. The Bank believes the lawsuit is without merit and intends to vigorously defend itself,” the bank said.
Shares of HDFC Bank Ltd. closed at ₹727.20 on Wednesday, down 0.04% that day.
First Published: Aug 27, 2026 8:56 AM IST
