Vinod Rai, former...
Comptroller and Auditor General of India. It was Rai, under whose watch the CAG estimated the loss due to spectrum allocation at Rs 170,000-crore.
Rai has been appointed chairman of the Bureau, the Finance Ministry said in a statement.
Modi also approved the appointment of Anil K Khandelwal, former CMD of Bank of Baroda, H N Sinor, former Joint MD of ICICI Bank and Rupa Kudwa, former MD & CEO of rating agency Crisil, as members of the Bureau. Rai and the three members will have a two-year tenure from the date of notification, or until further orders. The Bureau would be responsible for the search and selection of heads of public sector banks, and for whole-time directors and non-executive chairman on the boards of PSU banks.
With the constitution of the Bureau, the government intends to professionalise the selection for tops posts at PSU banks.
The idea is to improve the commercial performance and governance process of the PSBs by appointing the right candidates to lead these institutions. The performance of state-owned banks has deteriorated, while their non-performing assets (NPAs) have increased sharply over the past couple of years.
In the last three years, public sector banks have written off Rs 114,000 crore, a leading newspaper had reported. PSU banks’ gross NPAs are expected to jump 31.48 per cent in the fiscal ending March 2016 — to Rs 426,400 crore from Rs 324,300 crore.
Last August, while announcing a reforms roadmap called Indradhanush for the PSU banks, the finance ministry outlined the structure of the Bank Board Bureau, and said the Bureau would be constituted by March. In his Budget speech last year, Finance Minister Arun Jaitley had announced setting up of an autonomous Bank Board Bureau to improve the governance of PSU banks.
The Bureau, which will in due course turn into a bank investment holding company, would also help banks develop differentiated strategies and capital raising plans through innovative instruments. State-owned banks need Rs 1.8 lakh crore of capital by March 2019, out of which Rs 1.1 lakh crore will be raised from the market, while the government has committed to provide Rs 70,000 crore, as per the finance ministry’s estimates.
A committee headed by former chairman of Axis Bank P J Nayak had in 2014 suggested setting up of a bank board bureau, which would be later turned into a bank investment company. The Bureau will replace the Appointment Board, which selects top officials for public sector banks.