Banking sector reforms: Modi government has empowered boards of public sector banks to create a new position of CGM to restructure their senior management.
PSU Bank Merger: Modi government’s decision to allow all nationalised banks with a turnover of Rs 10 lakh crore and above to create a new post of chief general manager will help them rationalise their top management. The new post created in the fresh scale of scale 8 will help the public sector banks to have more officers in senior positions as they seek to expand their footprint post-merger and consolidation in the banking space. Earlier the position of CGM was only available in large banks like State Bank of India and banking sector regulator – RBI and few others.
The decision came on the same day when finance minister Nirmala Sitharaman announced the merger of 6 public sector banks with four larger PSU banks.
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“CGM posts (in a fresh scale termed as Scale-VIII) may be created in nationalised banks that have a total business (being the summation of the gross loans and advances and total deposit of the bank, reckoned as per the last declared results of the bank) of Rs 10 lakh crore or higher, to act as an administrative and functional layer between the existing levels of general manager and executive director,”said the department of financial service in a letter.
“It will allow public sector banks to create a new layer of officers between general managers and executive directors,” said a senior official with State Bank of India.
“Earlier, the government directly used to appoint executive directors from among the general managers of the bank. This new layer will create more efficiency,” he told Financial Express Online.
Payscale for the post of CGM has been fixed at Rs 1,03,000-2,700/3-1,11,100-2800/1-1,13900 and other admissible allowances, duly approved by the bank’s board.
Eligibility for the post
1. General Managers with a minimum of two years’ experience may be considered for the post. But it also allows relaxation of 50% with the approval of the bank’s board. It means a general manager with one year experience in the post can also be considered for the promotion.
2. The eligible candidate should have at least two years of service left.
3. Posts for the CGMs should be in the ratio of one CGM for four general managers in the bank.
4. The process for promotion to the post of CGM will be as per the existing guidelines for the promotion of general managers of nationalised banks. These promotions are done by a selection committee comprising the managing director, CEO (senior-most executive director if office of MD and CEO is vacant), government nominee director, RBI nominee director and two outside experts.