Tuesday, Oct 21, 2014

Appointment of PSU bank chiefs to be reviewed: FM Arun Jaitley

Finance minister Arun Jaitley on Thursday said the government would review the appointments of chiefs of public sector banks. Finance minister Arun Jaitley on Thursday said the government would review the appointments of chiefs of public sector banks.
ENS Economic Bureau | New Delhi | Posted: August 15, 2014 12:34 am | Updated: August 15, 2014 9:59 am

Finance minister Arun Jaitley on Thursday said the government would review the appointments of chiefs of public sector banks.

“The time has come to be strict with PSU banks. I have urged the Cabinet Secretary and the RBI Governor to examine recent appointments in public sector banks,” he told reporters here.

The exercise, which is expected to examine all appointments made over the last few months, comes soon after the Central Bureau of Investigation arrested suspended Syndicate Bank chief SK Jain over alleged corruption charges involving a bribe of Rs 50 lakh for enhancing the credit limit of a company.

Earlier, CBI director Ranjit Sinha had also written to the finance minister pointing out that the appointment of Jain in 2013 lacked transparency and seemed to involve unfair practices. The CBI has also pointed out the high marks given to Jain during his interview for the post.

The appointment of a PSU bank chief typically involves a panel headed by the Reserve Bank of India Governor and includes the secretary, department of financial services as well as other senior officials as members. The applications are processed by the Cabinet Secretary and placed before the Appointments Committee of Cabinet (ACC) for its final approval.

The deciding factor for candidates is their Annual Confidential Reports that have 70 marks while the interview can fetch a maximum of 30 marks.

State-run banks, in which CMDs were appointed recently, include Canara Bank, Corporation Bank, Bank of India, IDBI Bank, Allahabad Bank and Central Bank of India.

But critics have argued that the process of appointing chairman and executives at PSU banks is opaque with no clarity over why a particular candidate is selected over others. Further, there were questions that different sets of rules were used for different appointments and there was no uniformity in the process.

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