Govt opens top PSU bank roles to private-sector professionals for first time: Report

India has for the first time allowed private-sector professionals to apply for top leadership positions in public-sector banks, including the post of Managing Director (MD) at the State Bank of India (SBI), NDTV Profit reported on Friday, citing an official communication.

The Nifty PSU Bank index hit a fresh 52-week high of 7,719.95 in intra-day trade on the National Stock Exchange (NSE), rising as much as 2%.

State Bank of India (SBI), UCO Bank, Punjab & Sind Bank, Indian Overseas Bank, Central Bank of India, Punjab National Bank (PNB) and Canara Bank were among the top gainers, rising between 2% and 5%.

The Appointments Committee of the Cabinet (ACC) has reportedly approved revised consolidated guidelines for the appointment of Whole-Time Directors (WTDs), including Chairpersons, CEOs, MDs and Executive Directors (EDs) in public-sector banks and state-run insurance companies.

Under the new framework, private-sector candidates will be eligible to apply for the SBI MD position if they have at least 21 years of professional experience, including 15 years in banking, and have served either two years at the board level of a bank or three years at the level immediately below the board.

The Financial Services Institutions Bureau (FSIB), which recommends candidates for top financial sector appointments, has also been authorised to engage independent human resource agencies to assess applicants from the private sector, NDTV Profit said.

The government has dropped the use of Annual Performance Appraisal Reports (APARs) from the evaluation process, moving instead toward a more performance- and competency-driven assessment system.

The Department of Financial Services (DFS) under the Ministry of Finance has communicated the new procedures to all public-sector banks and insurers.