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Business Exclusive Headlines India National News

State Banks to be rid of political appointees on boards

New Delhi/ Bangalore, Aug 7 (): State Banks are in for a clean-up as Finance ministry has asked that all the Congress leaders, persons not connected to financial sector be dropped from the director board.

In a latest case where Syndicate Bank CMD was suspended for taking bribe, an instance of a daughter been appointed on the director board to succeed her father, a practice usually done in family-owned business has come under scanner. This took place in Syndicate Bank in which government has 67% share.

The independent directors’ profile in State-owned banks shows how the then ruling party, Congress used it to accommodate their lackeys. A board member gets sitting fee ranging from Rs 20,000 onwards for a day’s work. The board meeting is not always at the State banks’ HQ but in tourists spots for the directors to have a holiday at the banks’ expense.

The succession of Jasleen Suri, daughter of Bhupinder Singh Suri in Syndicate Bank board took place within three weeks of her father stepping down. Bhupinder had been on the board for six years as shareholder director and represents the government. Jaslen had been appointed director two years ago.

Bhupinder’s link with world of finance is that he runs a gas service station and that too in the Race Course road where PM stays. His daughter was behind setting up BPCL In &Out stores and the bank credits her with 15 years of exposure to petroleum, retail business and real estate. Her co-directors do not have such exposure. One is Davangere Congress vice-president and the other is the party trade union worker.

Syndicate Bank is not the only State bank to have politicians; others have Doordarshan TV anchor, small time actors, PR agents and campaign managers of Congress leaders. State Banks appoint independent directors to bring in expertise to contribute to the management of the institution.

Union Bank of India has UP Women’s wing in-charge on board, AP Congress committee member in Corporation Bank, UP Congress committee member in Allahabad Bank, Indian Bank has Ajay Maken, then Union minister’s brother on board.

Pranab Mukherjee’s campaign manager in the Lok Sabha elections 2009 was made director in United Bank of India who apart from piling up bad loans in four years also took on board a PR manager and a small time businessman to improve the efficiency. The bank also had a Congress leader from Assam on board.

Finance Minister Jaitley has asked the officials to draw up a list to replace them with competent persons in all State Banks across the country.