Norms for top jobs at govt banks may be relaxed again

With eight chairmen and 12 executive directors (EDs) of public sector banks retiring in 2011-12, the government has set the ball rolling to fill the vacancies.

According to banking sector sources, the interviews are likely next month. However, there are reports that the government may, as it did last year, relax the eligibility criteria. For, under the current rules, only 11 people are eligible for all eight CMD vacancies and only 30 are eligible for the 12 ED posts.

To be eligible for the CMD’s post, a candidate must have served as an ED for at least a year and have at least two years of residual service. For ED, a candidate must have served at least two years as a general manager and have three years of residual service.

In the last round of interviews, the government relaxed the norms, reducing the residual service requirement to 18 months. This time, too, sources said, since only 11 candidates for chairmanship fulfiled the criterion, the government might reduce the residual period requirement. So, too, for EDs.

Among the banks that will see new faces at the top in the next financial year are Central Bank of India, Corporation Bank, Dena Bank, Andhra Bank, Syndicate Bank, Oriental Bank of Commerce, Bank of Maharashtra and Union Bank of India. The top post in Vijaya Bank will be vacant this year and the government has already identified H S U Kamath, an executive director of Canara Bank, for the job.

In addition, the CMD’s post in Punjab & Sind Bank has been vacant for more than six months. The bank has traditionally been headed by a Sikh. The finance ministry is processing the appointment of a Punjab-cadre Indian Administrative Service official and media reports suggest the Prime Minister’s Office has raised a question over the process. The traditional practice is to make the CMD of a small bank the head of a big bank. In 2011-12, Central Bank of India and Union Bank of India may see such lateral movement.