Finance Minister Arun Jaitley has asked the Reserve Bank of India (RBI) and the Cabinet Secretary to look for discrepancies in the recent appointment of chiefs of public sector banks (PSB).
Jaitley has written to RBI Governor Raghuram Rajan and the Cabinet Secretary stressing the need for a review in the wake of irregularities that have come to light.
A clutch of proposals for PSB Chairman appointments by the erstwhile UPA regime, days before demitting office, will also now come under the scanner. This move is seen as a direct fallout of the recent arrest of Syndicate Bank Chairman and Managing Director SK Jain by the Central Bureau of Investigation for alleged corruption.
The RBI Governor heads the appointments board, which selects the chief executives (Chairman and Managing Director) of public sector banks.
The Cabinet Secretariat processes all the papers for the Appointments Committee of the Cabinet.
There was an impression gaining ground in the last two years that there was no settled procedure to select the Chairmen and executive directors of PSBs. As a result there was little transparency and the application of rules was open to distortion on political considerations. Instances have come to light of meritorious candidates getting good annual appraisals being bypassed by those who had political clout or used middlemen.