New Delhi: Banks Board Bureau (BBB) chairman Vinod Rai on Monday dismissed reports of lack of coordination between the board and the government saying that the rapport was ‘total’ and he often met finance minister Arun Jaitley and received guidance from him.
Even had the privilege of attending meeting chaired by the Prime Minister on the banking sector, he said, stressing the government never ever interfered in any appointment process and the bureau was given a total free hand.
“The BBB in the last two years has done monumental work with support and cooperation of the RBI and the government along with secretaries to the government of India working as members to the BBB," he told PTI. The former Comptroller and Auditor General (CAG) said that the coordination was to the extent that the finance minister himself took him into confidence even when there was change of guard at the two large public sector banks in May 2017.
He further said that since the term of the BBB was coming to an end on 31 March, it was decided to collate all the work done by the bureau so that when the new BBB comes into being it would act as a base document for them.
“This consolidated set of record or Compendium of Recommendations would come handy for the new BBB. This was created and put on the website but I could not see the finished document as I was away from the country. I have been to Singapore for 10 days. I came back from Singapore only on (last) Saturday," he said.
Rai regretted the fact that an oversight in the 60 page compendium has been blown up to misleading headlines. “When it was put on the website unfortunately there were some misleading headlines with regard to letter written to the Finance Minister in July 2017 on which some suggestions were given," he said. Those suggestions were discussed with the finance minister and the financial services secretary a number of times post that letter, he said.
“I must have met finance minister at least half a dozen times. Whenever I sought an appointment, I used to get the appointment to discuss various things. So formally, informally issues were discussed and taken forward," he said.
Recalling an incidence of close cooperation and coordination, Rai said, the finance minister was so fair that he took him into the confidence even when the managing directors of two large banks—Punjab National Bank (PNB) and IDBI Bank—were changed last year.
“So the rapport was total…in the Compendium there is reference to the letter but that is much old and after that much water has flowed down. Eight months have past and much has built up after the letter," he added.
On reforms initiated in the public sector banks (PSBs), Rai said, it has been a path breaking decision to set up the BBB along the decision of P.J. Nayak committee. For any government to say that it will distance the governance structure or the stake holding of the public sector banks away from the government and political interference is a very revolutionary step, he said, adding, this decision was very well accepted across the world among the investors community.
Subsequently, the government with the expert advise of the BBB professionalised the PSB boards, ensuring efficient delivery by state-owned lenders, appointment process made objective and efficient.