Guidelines for Selection of PSU Banks Heads Finalized

In a crucial development, the Government of India has finalized the guidelines for the selection of MD and CEOs of Public Sector Banks (PSBs). The Appointment Committee of Cabinet (ACC) has approved the latest guidelines for selection of smaller PSBs banks, other than the five large public sector banks. As per the new guidelines “Executive Directors of Nationalised Banks, DMDs of IDBI Bank and MDs of Associate Banks of SBI who have risen from the Associate Bank Services, with one year of service as ED/DMD/MD and who have two years remaining service are eligible to consideration as MD & CEO.” As far as the criteria of selection is concerned,  it will be done by an appointment board as per a well laid out methodology, presently exist about the interaction of candidate with three panels of sub-committee of the appointment board.

More importantly the selection of various heads of PSBs have been delayed due to non finalization of these guidelines by the government, and has been hampering the performance of the banks. The need for new guidelines came after various controversies surrounded regarding the performances of various PSBs CMDs in the past and vigilant government scrapped the selection panel and announced to formulate new guidelines last year. The Finance ministry has informed that the new process for the selection of new heads will be initiated next month.

New rule says the candidate will be rated out of 100 marks and in this 50 marks will be awarded as per the APARs of the candidate and other 50 will be given as per the interaction of the candidates with the sub-committee. The eligibility criteria of Executive directors (ED) of the nationalized banks has also been  finalized by the government. Under this all the general managers of the banks, who have completed two years of service are eligible for consideration for ED post.