Govt to review senior public sector bank appointments
Sidhartha & Neeraj Chauhan
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CBI Director's Note Talks Of `Irregularities'
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The finance ministry has decided to take a relook at recent appointments of top-level public sector bank executives as well as a clutch of proposals to designate chairmen just before the UPA demitted office, in what is seen as a direct fallout of the recent arrest of the Syndicate Bank chief by the CBI on alleged corruption charges. Senior finance ministry officials told TOI that a review had become necessary in view of the irregularities that had come to light.
Finance minister Arun Jaitley has written to Reserve Bank of India governor Raghuram Rajan, who heads the appointment board that selects state-run bank chiefs, as well as cabi net secretary Ajit Seth, who processes all papers for the appointments committee of the cabinet, sources said. Some of the appointments processed during UPA 's closing days lacked transparency and there are indications that some political considerations may have played a part, they added.
In a letter to the finance ministry, CBI chief Ranjit Sinha has pointed to some irregularities that have been noticed by the investigative agency during the Syndicate Bank probe.
Sources said CBI has suggested a “legal scrutiny“ as it has found clues suggesting that ACRs and interviews “were managed“ and some middlemen also played a role.
Sinha said Jain was appointed despite having “poor“ ACRs. “We have told the government that appointments de serve to go under legal scrutiny.
The government has to take a call. There are reports of irregularities in several appointments. We have informed the government about it,“ the CBI chief said.
For the past few years, appointment of several bank chiefs, executive directors as well has independent directors have been viewed with a degree of suspicion and have often re sulted in controversy . The candidates are selected on the basis of an appraisal of the confidential reports (ACRs), which carry 70 marks, and candidates appearing for interviews for executive directors and CMDs can get another 30 marks. Apart from the RBI governor, financial services secretary , an RBI deputy governor and external experts are part of the appointments board.
Similarly , there is no clarity on what goes into deciding the allotment of banks.
There have been instances of some of the candidates barely opening their account in the interviews but still being recommended for appointment based on their ACRs. In 2012, while appointing a second-rung executive, the department of financial services was accused of changing the grades from “very good“ to “outstanding“, making the executive eligible for the job. Once the gap was pointed out, the appointments committee of cabinet had put the appointment on hold, but later cleared it. On several occasions, the department of financial services has changes the criteria for appointment. For instance, to become a public sector bank CMD, the candidate should have been an executive director for at least two years and should have at least two years to go for retirement. Often these stipulations have been tweaked.
What really attracted attention in the corridors of ministries was the UPA government's decision to interview candidates for bank chiefs late last year even when the first vacancy was not arising till August.
In a letter to the finance ministry, CBI chief Ranjit Sinha has pointed to some irregularities that have been noticed by the investigative agency during the Syndicate Bank probe.
Sources said CBI has suggested a “legal scrutiny“ as it has found clues suggesting that ACRs and interviews “were managed“ and some middlemen also played a role.
Sinha said Jain was appointed despite having “poor“ ACRs. “We have told the government that appointments de serve to go under legal scrutiny.
The government has to take a call. There are reports of irregularities in several appointments. We have informed the government about it,“ the CBI chief said.
For the past few years, appointment of several bank chiefs, executive directors as well has independent directors have been viewed with a degree of suspicion and have often re sulted in controversy . The candidates are selected on the basis of an appraisal of the confidential reports (ACRs), which carry 70 marks, and candidates appearing for interviews for executive directors and CMDs can get another 30 marks. Apart from the RBI governor, financial services secretary , an RBI deputy governor and external experts are part of the appointments board.
Similarly , there is no clarity on what goes into deciding the allotment of banks.
There have been instances of some of the candidates barely opening their account in the interviews but still being recommended for appointment based on their ACRs. In 2012, while appointing a second-rung executive, the department of financial services was accused of changing the grades from “very good“ to “outstanding“, making the executive eligible for the job. Once the gap was pointed out, the appointments committee of cabinet had put the appointment on hold, but later cleared it. On several occasions, the department of financial services has changes the criteria for appointment. For instance, to become a public sector bank CMD, the candidate should have been an executive director for at least two years and should have at least two years to go for retirement. Often these stipulations have been tweaked.
What really attracted attention in the corridors of ministries was the UPA government's decision to interview candidates for bank chiefs late last year even when the first vacancy was not arising till August.