Norms for appointment of CMDs in public sector banks relaxed

Search panel to interview candidates for CMD and ED posts next week

The government has relaxed the eligibility criteria for the appointment of chairman and managing directors (CMDs) in public sector banks.

For appointments of CMDs, as well as executive directors (EDs), in public sector banks in 2013-14, a committee would interview candidates next week. In 2013-14, the chiefs of nine public sector banks are set to retire.

These banks include IDBI Bank, Central Bank of India, Union Bank of India, Allahabad Bank, Andhra Bank and Bank of Maharashtra.

Now, those who have served as ED for at least six months would also be eligible for the post of chairman.

Earlier, those who had served as ED for two years were eligible; the criterion was later relaxed to a one-year term as ED.

This year, if the one-year term was applicable, only nine candidates would have been eligible; the number of posts of CMDs that would fall vacant in 2013-14 is also nine.

The residual period of EDs has also been relaxed. Earlier, EDs with two years of service remaining were eligible; this time, those with 21 months of service remaining are also eligible.

The panel to select candidates for the banks includes Banking Secretary Rajiv Takru, Reserve Bank of India Deputy Governor Anand Sinha, a former deputy governor of the central bank and two professors from management institutes.

Bankers said the search panel would interview 17-18 candidates, including some who had attended such interviews earlier as well.

The panel has called about 35 general managers who would be promoted as EDs.

The government has said banks with business worth more than Rs 2 lakh crore would have two EDs. On the other hand, those with business worth more than Rs 3 lakh crore would have three EDs.

Currently, only Punjab National Bank, Bank of Baroda and Bank of India have three EDs. A third ED would be appointed for Union Bank of India, Central Bank of India and Canara Bank.

The finance ministry wants an ED in a public sector bank to focus exclusively on human resources and information technology.