At a time when the global financial sector is going through a critical phase, several Indian public sector banks are functioning without their executive directors, thanks to a delay in the appointment process. The delay in appointments is hindering the normal functioning of these banks, sources said.
Posts of executive director in Bank of India, Corporation Bank, Oriental Bank of Commerce (OBC), Syndicate Bank, Punjab and Sind Bank, Bank of Maharashtra, Central Bank of India and Union Bank of India are lying vacant for months. K Raghuraman, executive director, Punjab National Bank, retired on Monday and there has been no replacement since.
T Vallipan, executive director, Vijaya Bank, retired on April 30. The post has been lying vacant since then. Similarly, GS Matta, executive director of Punjab and Sind Bank retired on March 31. Allen C A Pereira, executive director, OBC, took over as chairman and managing director of Bank of Maharashtra on August 1.
There is a growing sense of discontent among PSU bank employees with the appointment process moving at a snail’s pace. “Though PSU banks are insulated and have little co-relation with the Wall Street collapse, we cannot afford to take it easy,” a senior PSU bank official told HT. “The going is tough for the banking sector in general and in fact we could have cashed in on the situation.”
With low consumer sentiments and investors losing confidence on foreign and private sector banks, state-owned banks should have adopted a full-fledged strategy to increase customer base, the official said.
According to sources in the banking industry, though the fundamentals of PSU banks are strong, the time has come to increase efficiency in order to maintain profit margins, especially at a point when high interest rates are becoming a serious issue.