Banking sector reforms: Modi government has enabled boards of public sector banks to create a new position of CGM to restructure their senior management.
PSU Bank Merger: Modi government’s decision to permit all nationalised banks with a turnover of Rs 10 lakh crore and over to make a new post of chief general manager will help them rationalise their top management. The new post created in the brand new scale of scale 8 will help the public sector banks to have more officers in senior positions as they try to expand their footprint post-merger and consolidation in the banking area. Before the standing of CGM was only available in massive banks such as State Bank of India and banking industry regulator — RBI and others.
The decision came on the same day when finance minister Nirmala Sitharaman announced the merger of 6 public sector banks with four bigger PSU banks.
“CGM articles (in a brand new scale termed as Scale-VIII) could be created in nationalised banks which have a entire company (being the summation of their gross loans and advances and total deposit of the bank, reckoned in accordance with the past declared results of the lender ) of Rs 10 lakh crore or greater, to act as an administrative and operational layer between the present levels of general manager and executive director,”said the department of financial support in a letter.
“It enables public sector banks to make a new layer of officers between general managers and executive directors,” said a senior official with State Bank of India.
“Before, the authorities directly utilised to appoint executive directors from among the general managers of the lender. This new layer will create more efficiency,” he advised Financial Express Online.
Qualification for the post
1. General Managers with a minimum of 2 years’ experience may be considered for this post. But additionally, it permits comfort of 50% with the approval of the bank’s board. This means a general manager with one year experience from the article may also be considered for the promotion.
2. The qualified candidate must have at least two decades of service left.
3. Articles for the CGMs should be in the ratio of one CGM for four general managers in the bank.
4. The procedure for promotion to the post of CGM will be as per the present guidelines for the promotion of general managers of nationalised banks. These promotions are done by a selection committee comprising the managing director, CEO (senior-most executive manager if office of MD and CEO is vacant), government nominee director, RBI nominee director and two external experts.