PSU Banks will soon recruit independent directors, the government started the process.
The government has started the process to fill around 100 vacancies of independent directors in public sector banks and financial institutions.
The government has taken this step with the aim of meeting the regulatory requirement.
Under the Companies Act, 2013, one-third of the total directors of every listed company should be independent directors.
Sources said that in many listed public sector banks and some financial institutions, the number of independent directors is less than the prescribed requirement.
This is not only a violation of the Companies Act but also the Securities and Exchange Board of India’s (SEBI) listing rules.
For example, Indian Overseas Bank (IOB), Indian Bank, and UCO Bank are not complying with the independent director norms.
Except for the State Bank of India (SBI) and Bank of Baroda, the post of chairman is vacant in other public sector banks.
The posts of employee directors and officer directors representing the employees and officers of banks have also been vacant for seven years.
According to a study, there were 72 public sector undertakings in the Nifty 500 in 2019 and 2020. The number of independent directors in the Nifty 500 PSUs in 2020 was 133 less than the previous year.
It has a total of 12 public sector banks, four public sector general insurance companies, and one life insurance company.
There are public sectors financial institutions such as IFCI, IIFCL, ECGC Limited, and EXIM Bank.
All India Bank Employees Association (AIBEA), in a letter to Finance Minister Nirmala Sitharaman, has said that 52 percent of posts of directors in 11 nationalized banks are vacant.
PSU Banks will soon recruit independent directors: Nifty jumps reach 18000-mark; Top jump in Tata Motors, Maruti, NTPC.
Domestic stock markets saw a rise in early trade. At 09:55 am, Sensex based on 30 stocks was trading at a level of 60,247.88 points, up by 188.82 points or 0.31 percent.
Similarly, NSE Nifty was trading at the level of 17,971.55 points with a gain of 76.35 points or 0.43 percent. However, Nifty50 crossed the 18000 mark during the initial trading itself.
Shares of Tata Motors, Coal India, Maruti, NTPC, and ONGC included in Nifty 50 were seeing the biggest jump.
On the other hand, shares of TCS, Wipro, Tech Mahindra, Infosys, and Bharti Airtel were the biggest losers.