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    SBI chief, three MDs asked to interview for bank's top job; signs point to Rajnish extension

    Synopsis

    While it would appear to be unprecedented for a chairman to be part of a panel to be interviewed for the position he already holds, it may, according to people familiar with the situation, send a message that the government prefers tried and tested hands in key positions instead of risking a new leader at a time when the financial system is facing unprecedented crises.

    KOLKATA | MUMBAI: The government has asked State Bank of India chairman Rajnish Kumar to appear for an interview to fill the position that he would be vacating this October, possibly signalling one more term for him.

    Three managing directors – Dinesh Kumar Khara, Arijit Basu and CS Setty – are likely to be interviewed too for the top job at the country’s largest lender. The interview will be conducted digitally by the Banks Board Bureau on August 18 or 19, two people familiar with the matter told ET. The position of fourth MD in SBI is now lying vacant.


    While it would appear to be unprecedented for a chairman to be part of a panel to be interviewed for the position he already holds, it may, according to people familar with the situation, send a message that the government prefers tried and tested hands in key positions instead of risking a new leader when the country’s financial system is passing through an unprecedented crises.

    The government recently extended the term of Securities & Exchange Board of India chairman Ajay Tyagi. It has also offered an extension to Union Bank of India chief executive Rajkiran Rai, in this case without any interview.

    The government also risks sending out a wrong signal if the existing chairman doesn't get another term even after being called for the interview, said the people cited. While some said the move is in sync with better corporate governnance standards. M Damodaran, the former Sebi chief, had famously declined to be interviewed in 2008, preferring instead to step down.

    SBI did not respond to ET’s mail seeking details on the development.

    Kumar’s predecessor Arundhati Bhattacharya received an extension for little over a year in 2016 when SBI was going through the process of merging five associate banks and Bharatiya Mahila Bank into itself. Kumar, now 62, was an MD during that period. The merger came into effect on April 2017.

    Kumar’s current term is coming to an end on October 7. He had taken charge at SBI on October 7, 2017, just three months ahead of his scheduled superannuation date. According to the statute, chairman or chief executive of a public sector bank can continue till 65.

    During the second quarter of financial year 2017-18, SBI’s net interest margin, a key profitability parameter was at 2.43% which improved to 3.01% in the first quarter of the current financial year.

    SBI’s total loan book grew Rs 22.38 lakh crore from Rs 20.03 lakh over the same period.

    "The bank has made considerable efforts over the years to maintain consistency irrespective of leadership changes. The current high PCR (provision coverage ratio) and manageable SMA (special mention account) book indicate a healthy balance sheet," said Lalitabh Srivastawa, banking analyst at Sharekhan Brokerage.

    “If the current SBI chairman gets an extension, we believe markets will take it positively as we are going through extraordinary times."
    (Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

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    36 Comments on this Story

    W. D. Deshmukh47 days ago
    I agree with Gangadharrao Tamma.
    Mohan47 days ago
    A shocking News about this so called biggest Bank which the general public may not know !! A retired Chief General Manager of SBI (retired in 1998) now getting pension less than a Peon (Head Messenger,who worked under him and retired now in 2018 as Peon).This is the state of the status of bigwigs of SBI after retirement !!
    Prasen Kumar Reddy Singi47 days ago
    No self respecting individual will attend to a interview for the post which he/she holds.How the Government expects talented persons to be at the helm of affairs.
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