As many as six public sector banks (PSBs) are currently working without a non-executive chairman, Lok Sabha was informed recently.

At present, the position of non-executive chairman is vacant in Bank of lndia, Bank of Maharashtra, Central Bank of India, Indian Bank, Indian Overseas Bank and UCO Bank, Bhagwat Karad, Minister of State for Finance said in a written reply to an unstarred question.

It maybe recalled that the government had, in April 2015, introduced the provision for separation of posts of chairman and managing director in PSBs and appointment of separate persons for these posts from the vacancy year 2014-15 onwards.

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Subsequent to this, non-executive chairman (NEC) had been appointed in 9 banks (out of 11 nationalised banks), namely Bank of Baroda, Bank of lndia, Canara Bank, Central Bank of India, lndian Bank, lndian Overscas Bank, Punjab National Bank, Punjab and Sind Bank and Union Bank of India.

NECs in PSBs preside over the meetings of the Board and Committees of Board, wherever they are appointed as chairperson of the such Committees. 

Experts pointed out that in the absence of a chairman, the rules provide that the managing director would have to preside over the meetings of the Board.

This provision is contained in paragraph 12(6) of the Nationatised Banks (Management and Miscellaneous Provisions) Scheme 1970 and 1980, they said.

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There may be six PSBs that are currently working without a chairman, but the respective banks continue to function smoothly, noted a former chief executive of a public sector bank. 

The government had constituted the Financial Services Institutions Bureau (earlier known as Banks Board Bureau), which is mandated to recommend persons for appointment as NECs.

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