RBI expresses concern over delay in appointing heads of banks

Mumbai: Expressing concern over the delay in appointing heads of three large public sector lenders, RBI Deputy Governor S S Mundra said that the central bank has urged the government to expedite the process in this regard.

The government is yet to appoint heads of three 'A' category banks, namely Bank of Baroda, Punjab National Bank and Canara Bank, which have been headless for many months now. "Certainly, I am deeply worried. Three large public sector banks, which fall under the category of the top four banks, are without heads.

Leadership matters in our organisation for policy direction," RBI Deputy Governor S S Mundra, who himself was a commercial banker, said. Last December, the government had split the post of chairman and managing director for state-run banks and appointed managing directors as well as chief executives at banks.

The four managing directors and chief executive officers appointed are P Srinivas at United Bank of India, R Koteeswaran at Indian Overseas Bank, Kishore Kumar Sansi at Vijaya Bank and Animesh Chauhan at Oriental Bank of Commerce. Mundra said that the central bank has also asked the government to take a decision soon about appointing heads of these three large banks.

"From the RBI side also, these concerns are flagged to the government in its capacity as owner, to hasten the process and see that these appointments are done as early as possible," he said. The government is also yet to find a replacement for Syndicate Bank CMD S K Jain, who was suspended after his arrest in an alleged graft case.

Replying to a specific question about consolidation in the banking industry, Mundra said that consolidation and merger is a very long-term strategy and its purpose has to be analysed before going for it.