Business India

Rajan seeks more autonomy to public sector bank boards

Former RBI Governor Raghuram Rajan on Friday called for more autonomy to the boards of public sector banks (PSBs) to make them independent of government shackles.

For this, he said the various layers of the government must be removed from the appointment processes of the chief executives and the board members of the PSBs.

“We need independent and professional boards in public sector banks… independent of the government. They should have the ability to hire and fire a CEO,” Rajan remarked at an event to launch his book here late this evening.

Professor of Economics at the University of Chicago’s Booth School of Business, the renowned economist said when this is achieved (independent banks boards), then we can say “we have truly created the distance between the government the public sector banks”.

“One indication of having achieved this would be the day when we can shut down the (Finance Ministry’s) Department of Financial Services,” said Rajan who was the Governor of Reserve Bank between September 2013-September 2016.

Rajan’s comments came during an interaction with media during the launch of his book, “I Do What I Do – On Reform, Rhetoric and Resolve” here after it was released in Chennai and New Delhi during this week.

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