The Hindu Business Line : Panel to screen elected directors of SBI arms

Mumbai, Nov 15 The Reserve Bank of India has asked all the associate banks of State Bank of India to constitute a ‘nomination committee’ consisting of a minimum of three independent and non-executive directors from amongst the board of directors. The board should also nominate one among them as Chairman of the nomination committee, said a notification from RBI.

In case of absence of any member already nominated, the board may nominate any other independent director in his place . The board can decide on the tenure at the time of constituting the committee.

The committee would be required to undertake a process of due diligence to determine the ‘fit and proper’ status of existing elected directors or the person to be elected as a director. The committee should determine the ‘fit and proper’ status of candidates based on the educational qualification, experience and field of expertise, track record and integrity of the person.

The committee should also see whether the non-adherence to any of the above criteria would hamper the existing elected director or proposed candidate from discharging the duties as a director on the board of the bank. Any action coming to the adverse notice of any authority or regulatory agency or insolvency or default of any loan from any bank or financial institution would make the candidate unfit and improper to be a director on the board of a bank, said the notification.

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