 "Rising NPAs put Dena Bank under corrective action plan")
The government on Thursday appointed non-executive chairpersons of three public sector banks- Dena Bank, Punjab & Sind Bank and Central Bank of India.
Former Corporate Affairs Secretary Tapan Ray will be the non-executive chairperson of Central Bank, former Reserve Bank of India director Dr Charan Singh of Punjab & Sind Bank and ex-global partner at TPG Private Equity Anjali Bansal of Dena Bank.
Department of Financial Services Secretary Rajiv Kumar said the appointments were based on recommendations of the newly-reconstituted Banks Board Bureau (BBB) and termed the move as being part of banking reforms.
This is the first appointment of bank executives recommended by the BBB under former DoPT Secretary Bhanu Pratap Sharma's leadership.
The appointments come at a time when these banks are under the strict watch of RBI. Dena Bank, Central Bank of India and Punjab & Sind Bank are among 11 PSBs under the RBI's prompt corrective action (PCA).
These banks face severe restrictions-- including curbs on dividend distribution, branch expansion and management compensation-- for breaching various limits.
In fact, RBI has put restrictions on all fresh lending by Dena Bank.
Also, Dena Bank and Punjab & Sind Bank, which are facing lending restrictions, haven't had a chief executive officer since the beginning of this calendar year.
The process of replacing and appointing bank executives on the boards of public sector banks has already been initiated as the government has written to the BBB to send recommendations.
