The Reserve Bank of India has decided to constitute a committee to examine the recommendations of the Financial Sector Legislative Reforms Commission (FSLRC) relating to capacity building in the banking sector.

It will examine if the members on bank boards need to be certified — by way of say, an appropriately designed course which could be made mandatory for every individual before appointment to the board of a bank. The committee, which is headed by G Gopalakrishna, Executive Director, Reserve Bank of India, has been tasked with the responsibility of identifying capacity building requirements keeping in view the role of financial sector and what it should deliver.

The panel will examine the skills required at various levels/operations to deliver on the required role and also identify qualifications relevant to specific areas of operation in banks and non-banks. Further, it will evolve methodologies for prescribing certification for required qualifications.

Besides Gopalakrishna, the committee has eight other members, including Mohan V Tanksale, Chief Executive, Indian Banks’ Association, Ranjan Dhawan, Executive Director, Bank of Baroda, and K Ram Kumar, Executive Director, ICICI Bank.

The Committee is expected to submit its recommendations by April 30.

The Commission, which was set up in March 2011 and submitted its report last March, was the result of a felt need that the legal and institutional structures of the financial sector in India need to be reviewed and recast in tune with the contemporary requirements of the sector

It has made important recommendations pertaining to nine areas, including consumer protection, micro-prudential regulation, capital controls, systemic risk, monetary policy, public debt management, contracts, trading and market abuse.

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