LIC chief slips a notch: scam impact?
LIC chairman TS Vijayan was today redesignated as managing director of the state-owned insurance behemoth, triggering speculation whether last year's "cash-for loans" scam involving its housing finance arm had something to do with the unexpected move. HT reports.Updated: May 03, 2011 21:14 IST
Life Insurance Corporation (LIC) chairman TS Vijayan was on Tuesday redesignated as managing director of the state-owned insurance behemoth, triggering speculation whether last year's "cash-for loans" scam involving its housing finance arm had something to do with the unexpected move.
Rakesh Singh, additional secretary, department of financial services, has been given concurrent charge as LIC chairman with effect from Tuesday for an interim period of three months.
Vijayan's five-year term ended on Monday and he was not given an extension even though he has two years to go for retirement.
According to government norms, a chairman and managing director or a director is appointed in a public sector entity for a period of five years or up to the age of 60, whichever comes first.
The government has constituted a committee headed by department of economic affairs secretary R Gopalan, along with financial services secretary Shashi Kant Sharma to select new full-time chairman for LIC.
DK Mehrotra, one of the three managing directors in LIC, is believed to be front-runner to become the new LIC chairman.
This is the first time that any chairman of LIC has been asked to work as a managing director.
The Central Bureau of Investigation had arrested LIC Housing CEO RR Nair last year for allegedly approving loans after taking bribes. Also arrested were Naresh K Chopra, secretary (investment), LIC and Rajesh Sharma, chairman of f Mumbai-based firm Money Matters Ltd among others.