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Professionals to help pick new IDBI chairman

Calcutta, Aug. 28: A search committee set up by the government to find a chairman and managing director for Industrial Development Bank of India (IDBI) has asked chiefs of select nationalised banks and public sector units to come up with relevant names.

A communication to this effect has gone to the heads of State Bank of India, Bank of Baroda, Bank of India, Corporation Bank, Uco Bank and Indian Bank.

The committee has also approached the heads of National Thermal Power Corporation, Oil and Natural Gas Corporation and Gail.

This is for the first time that the government has sought the opinion of banking professionals for appointing a chairman and managing director. This was a common practice abroad, bankers said. Heads of banks and financial institutions are selected in the US and UK based on the opinions of other bankers. The term of P. P. Vora, the present IDBI chairman, will end on September 30, 2003.

“We want to bring in more accountability for the person who will head IDBI. Once the IDBI (Transfer of Undertaking and Repeal) Bill becomes effective, the role of the chairman will become crucial. So we want somebody who can handle this changeover,” said a ministry official.

The search committee comprises Rakesh Mohan (deputy governor, RBI), M. G. Bhide (chairman, National Institute of Bank Management), Ashok Lahiri (chief economic adviser, ministry of finance) and Vinod Rai (joint secretary, ministry of finance).

Sources said the Centre was planning to appoint a commercial banker as the financial institution was being converted into a bank. It is also considering a market-related remuneration for the new chief.

“Ideally, the candidate should not be older than 55 years with at least 25 years of experience in financial institutions or banks, of which five years should be in a top management position not below the rank of a general manager of a nationalised bank or chief general manager in financial institutions or equivalent top management position, shouldering responsibility at the corporate level. He should be able to continue in office for three years at least,” finance ministry officials said.

The candidate should have experience in project financing, treasury operations, resource mobilisation, risk management, information technology, asset reconstruction and commercial banking.

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