The government is not in favour of a blanket increase in the retirement age for public sector banks’ managing directors/CEOs for now and would rather prefer to give an extension on a case-to-case basis to retain talent.The Financial Services Institutions Bureau (FSIB), the agency responsible for selecting the heads of state-run banks, is understood to have recommended increasing the retirement age of managing directors of PSBs to 62 years from 60.“Currently, there is no plan to increase the retirement age of managing directors in PSBs as it will deny promotional opportunities to the lower-level officers,” an official told FE.
“However, if the government feels that some talent has to be retained in the interest of the organisation, an extension can be given on case to case basis,” the official added.Another official described the discussions on increasing the retirement age in PSBs as very “fluid” and no decision has yet been taken on the matter.
In the case of the State Bank of India (SBI) chairman and LIC chairman, who could hold offices till the age of 63 and 62 years respectively, FSIB has suggested increasing their retirement age to 65.However, that would require amendments to both the SBI Act and the LIC Act, which stipulates the their superannuation. That’s the reason, the government would likely give an extension to current SBI chairman Dinesh Khara later this month till he turns 63 next year in August.
In 2021, the government extended the superannuation age of the LIC chairman to up to 62 years by making an amendment to the Life Insurance Corporation of India (Staff) Regulations, 1960.In 2014, the Reserve Bank of India fixed the upper age limit for managing directors, chief executive officers and other whole-time directors in private banks at 70 years, in line with the Companies Act, of 2013.