The government today issued norms for selection of MDs and CEOs in Public Sector Banks (PSBs), other than the five large state-owned lenders and the hiring process will start next month.
As per the guidelines, the selection to the top job in the PSBs would be from the existing pool of executive directors (EDs) or deputy managing directors (DMDs) in state-owned banks with a remaining service period of 2 years.
The guidelines come a week after the government had announced appointment of two private sector bankers to head Bank of Baroda and Canara Bank while also making appointments to three other large state-run banks from the public sector.
The new norms have excluded private sector executives to become part of the selection process of top management in the public sector banking space.
“Appointments Committee of Cabinet (ACC) has approved the guidelines for selection of MDs & CEOs in Public Sector Banks (PSBs) other than five large Public Sector Banks,” an official statement said.
“Executive Directors of nationalised banks, DMDs of IDBI Bank and MDs of associate banks of SBI who have risen from the associate bank services, with one year of service as ED/DMD/MD and who have two years remaining service are eligible for consideration as MD & CEO,” it said.
Earlier this week, Financial Services Secretary Hasmukh Adhia had said that hiring of CEOs and managing directors in PSBs would be from existing public sector talent pool and not from outside.
“For five large banks we had different procedure. For remaining banks, we are going to hire from the pool of executive directors of the public sector banks itself,” he had told PTI in an interview.
There is a CEO and MD vacancy in Indian Bank and Andhra Bank and there would be another vacancy in UCO Bank by the end of this month.
Besides, a vacancy has been created with the movement of Chairperson and Managing Director of Bharatiya Mahila Bank to PNB as CEO and MD.
The statement further said that the selection will be made by the Appointments Board as per the existing methodology of interaction of the candidates with three panels of the sub-committee of the Appointments Board.
The candidates will be rated out of 100 marks with 50 marks to be awarded for Annual Performance Appraisal Reports (APARs) of five years and 50 marks assigned on the basis of performance during interaction with the sub-committee, it said.
“The selection process is to be initiated in the next month,” it added.
The guidelines have also laid down the eligibility criteria for the post of executive directors of the nationalized banks.
General Managers of nationalized banks and CGMs of associate banks of SBI who have risen from the associate banks service, and who have completed two years of service are eligible for consideration for the post of executive director.
FM Arun Jaitley likely to meet heads of PSU banks in first half of Sept
Finance Minister Arun Jaitley is likely to meet heads of PSU banks in the first half of next month, days after the government unveiled 7-point agenda to revive the fortunes of PSBs.
The performance review meeting of Public Sector Banks (PSBs) may take place in the first half of September and the exact date will be decided soon, sources said.
It could happen in the first week of next month depending on confirmation from the Finance Minister, they added.
Besides discussing the ‘Indradhanush’ plan for revamp of PSBs, the meeting will review financial performance of banks and take stock of the non-performing assets (NPA) situation.
The gross NPA of the PSBs rose to 6.03 per cent at the end of June 2015 as against 5.20 per cent in March 2015.
The meeting is expected to review credit offtake by sectors such as home, education and minority as well as the progress made under the Jan Dhan Yojana and Prime Minister’s social security schemes, among other issues.
Jaitley is expected to also review the progress of three social security schemes namely Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Atal Pension Yojana (APY), among others.
He will also review the progress made with regard to Micro Units Development & Refinance Agency (MUDRA), expeditious disposal of public grievances and Credit Enhancement Guarantee Scheme for Scheduled Castes, among others.
Last week, the government announced 7-point agenda including Rs 70,000 crore capital infusion in PSBs in four-year period starting with Rs 25,000 crore in this fiscal and creation of Bank Board Bureau (BBB).
Besides, it announced measures to de-stress the banks of NPAs by introducing governance reforms.
In order to professionalise PSBs, the government also announced appointment of two private sector bankers to head Bank of Baroda and Canara Bank while also making appointments to three other large state-run banks from within the government sector.