After a delay of over ten months, the government has appointed IDBI Bank managing director and CEO M K Jain as Deputy Governor of Reserve Bank of India (RBI) in place of S S Mundra, who had completed his three-year term in July last year.
Jain, who holds MCom, MBA and CFA degrees, has been MD of IDBI Bank since March 2017. Prior to this, he was MD of Chennai-based Indian Bank and played a key role in the turnaround of the bank where he was appointed MD in November 2015. Jain started his career in Punjab National Bank and also worked as General Manager in Syndicate Bank.
“Government appoints experienced banker Mahesh Kumar Jain, MD & CEO of IDBI Bank as Deputy Governor of RBI for a term of three years,” financial services secretary Rajiv Kumar tweeted Monday.
Jain will join the RBI at a time when the banking sector is going perhaps through its worst crisis. Twenty-one PSU banks had reported over Rs 62,000 crore loss — the steepest quarterly loss for the sector — and gross non-performing assets of over Rs 8.40 lakh crore in the March quarter.
Deputy Governor NS Vishwanathan is currently in-charge of the Department of Banking Supervision, Department of Non-banking Supervision and the Department of Cooperative Banking Supervision, earlier handled by Mundra.
When the RBI’s deputy governor post fell vacant after Mundra retired at the end of July last year, the government sought applications from bankers and bureaucrats. The other candidates called for the final interview other than Jain on May 10 included Charan Singh, Executive Director, UCO Bank, SBI managing directors B Sriram and PK Gupta, KP Krishnan, Secretary of Skill Development and Entrepreneurship, Yaduvendra Mathur, Additional Secretary, NITI Aayog and TV Somanathan, Principal Secretary in Tamil Nadu.
The Financial Sector Regulatory Appointment Search Committee headed by the Cabinet Secretary interviewed the shortlisted candidates on May 10. The search panel also included RBI Governor, Financial Services Secretary and some independent members.
According to the RBI Act, the central bank should have four deputy governors. Currently, two are selected from within the RBI ranks and one commercial banker and an economist head the monetary policy department. Other Deputy Governors are Viral Acharya, N S Vishwanathan and B P Kanungo.
Although interviews to find a replacement for Mundra were conducted on July 29 last year, the government decided to start the process all over again in January this year.