Top appointments in govt banks delayed despite FM's initiative

Posts of chairman and MD in four banks lying vacant

The delays that characterised appointment of public sector banks chiefs are back. Reason: Changes in rules proposed by the finance ministry.

Already, the post of chairman and managing director in four government-owned banks is vacant, apart from similar vacancies in the Small Industries Development Bank of India and the National Housing Bank. It is unlikely that the vacancies will be filled any time soon.

The delay is happening despite Finance Minister Pranab Mukherjee’s initiative to speed up filling of top posts in public sector banks. In two instances earlier this year, in case of United Bank of India and Indian Bank, appointment orders were issued more than one month before the incumbent retired. This prevented last-minute hiccups.

However, it’s back to square one. Top posts at four state-run banks, Punjab and Sind Bank, UCO Bank, Corporation Bank and Canara Bank, are vacant. In August, Andhra Bank Chairman and Managing Director R S Reddy will also retire.

The government has shortlisted candidates and is seeking their consent, except in case of Punjab & Sind Bank, for which the hunt for a Sikh IAS officer started late. After the candidate gives his consent, the file goes to the appointments committee of the cabinet, headed by the prime minister.

In case of bank chiefs, the department of personnel sought some clarifications and questioned the process for at least two banks.

The appointment in one large bank is facing special scrutiny, as the selected candidate is still an executive director. This is because in practice, an official first gets the top post in a smaller public sector bank.

A source said the finance ministry had clarified but the matter was yet to be resolved. Besides, they said the cause of the problem laid in the finance ministry’s decision to select candidates who had less than two years of residual service, which had also been criticised.

In the remaining part of the year, four more vacancies will arise at the top, in addition to the seven that exist. Out of seven, five chairmen have retired and two have been posted in different government agencies. Of the seven posts vacated so far, three appointments have been made.