Previous Year Question

The question is based on the institutional arrangement applicable in 2019. At that time, the Banks Board Bureau (BBB) was responsible for identifying candidates and making selection recommendations for top positions in Public Sector Banks.

The Central Government constituted the BBB in 2016 as an autonomous advisory body to assist with leadership appointments and governance reforms in Public Sector Banks and certain public financial institutions.

The BBB assessed candidates and made recommendations for senior positions such as Chairperson, Managing Director, Chief Executive Officer and Whole-Time Director in Public Sector Banks.

A distinction must be maintained between selection recommendation and final formal appointment. The BBB selected and recommended candidates, while the final appointment was made through the competent appointment process of the Central Government. Among the given alternatives, the Banks Board Bureau is therefore the correct answer.

The RBI regulates and supervises the banking operations of Public Sector Banks, but it was not the body responsible for selecting their Chairpersons. The Ministry of Finance could participate in the final governmental appointment process, but the BBB was the specialised body constituted for candidate selection and recommendation. The management of the concerned bank also did not independently select its own Chairperson.

In 2022, the Central Government replaced the BBB with the Financial Services Institutions Bureau (FSIB). This subsequent institutional change does not alter the answer to the question asked in 2019.