33% of PSU banks board must comprise IDs: Assocham

New Delhi, Nov 14 | Updated: Nov 15 2005, 05:54am hrs
The Associated Chambers of Commerce and Industry of India (Assocham) has suggested the government that the number of independent directors (IDs) in all public sector banks should be one-third of their board strength after the amendments are executed in the existing banking companies (acquisition & transfer of undertakings) and financial institution laws.

The industry body had earlier, however, proposed that ID strength in other companies should be restricted to one-fourth of the total board strength.

At present PSU banks where the non-government holding is not more than 20% of capital, the independent directors cannot be more than two.

In case of banks, having more than 20% and not more than 40% non-government holding, the strength of independent directors cannot exceed four.

However, where non-government holding is not more than 40% in such banks, the strength of independent directors cannot be six as per current laws.