Former RBI deputy governor S S Tarapore came down heavily on RBI's practice of keeping RBI nominee directors on the boards of banks. | |
| "This obnoxious practice must be brought to an early end," said Tarapore addressing an audience at the Indian Institute of Management, Bangalore on risk management appreciation for bank directors. |
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| "If the Banking Laws Amendment is going to take time the RBI should persuade the government to issue an Ordinance on nominee directors... Nowhere in the world does a banking regulator puts its officials as nominees on the boards of banks," he added. |
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| According to him, the RBI is the regulator of banks and it is unconscionable that the regulator has a nominee on public sector banks. |
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| "The issue of withdrawing the RBI nominee director has been discussed for the past two decades. The RBI has, on more than one occasion, argued for withdrawal of its nominees from bank boards. This is also brought out in the recent JPC report on the Stock Market Scam. "It is inexplicable that this practice still continues," he said. |
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