New
Delhi: The Finance Ministry is against allowing public
sector banks (PSBs) to nominate Government nominee directors
as members of the management committee despite a request
to do so from many such banks.
While
both the Government and RBI nominees were earlier nominated
as members of the management committee, the Government
had in February this year amended the constitution of
the management committee of the board in PSBs to specify
that the Government and RBI nominees cease to be members
of the committee.
However,
the Finance Ministry says there is no reason to exclude
the RBI nominee director from the management committee
given that the central bank has chosen to replace the
serving officers with retired officers/non-officials as
nominee directors.
Recently
a number of PSBs including Punjab & Sind Bank have
been seeing board-level tussles and have urged the Finance
Ministry to permit the PSBs to nominate Government and
RBI nominee directors on the management committee.
Punjab
and Sind Bank had recently submitted to the Finance Ministry
that it did not have any professionally qualified director
on the board and that the removal of Government/RBI nominee
from the management committee has proved to be counter-productive.
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