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Business News/ Industry / Banking/  Govt will soon appoint heads of major PSU banks: Raghuram Rajan
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Govt will soon appoint heads of major PSU banks: Raghuram Rajan

A final decision will be taken by the Appointments Committee of the Cabinet, headed by PM Modi

A file photo of Reserve Bank of India governor Raghuram Rajan. Photo: Ramesh Pathania/MintPremium
A file photo of Reserve Bank of India governor Raghuram Rajan. Photo: Ramesh Pathania/Mint

Chennai: The government will soon appoint new heads of major public sector banks (PSU), Reserve Bank of India (RBI) governor Raghuram Rajan said on Thursday.

“The government is seized of the issue the need to move quickly on the appointment process. Now we are very close to the announcement, but the final word on that has to come from the government," he told reporters after a meeting of the RBI board in Chennai.

The department of financial services had earlier sought applications for the post of managing director and chief executive officer (CEO) in Punjab National Bank, Bank of Baroda, Bank of India, Canara Bank and IDBI Bank for a fixed term of three years.

A final decision will be taken by the Appointments Committee of the Cabinet (ACC), headed by Prime Minister Narendra Modi. When asked whether the absence of full time PSU bank chiefs is leading to deterioration in performance of banks, Rajan said, “All bankers are coming to us and saying the sooner we put the heads in place, the better. I don’t know what the actual analysis would reveal. I think that if the heads are important there would be some deterioration, whether it is significant or not I do not know."

In April, the department of financial services had relaxed the eligibility criteria for appointment of heads of public sector banks. While the age limit was increased from 55 to 57 years, the mandatory board-level experience for the applicants was reduced to one year from three years to invite more experienced talent for heading large public sector banks.

In December, the government had appointed managing director and CEO in four state-owned banks, Indian Overseas Bank, Oriental Bank of Commerce, United Bank of India and Vijaya Bank. The MD and CEO of Syndicate Bank was appointed in May.

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Published: 02 Jul 2015, 10:02 PM IST
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