Reserve Bank of India (RBI), which would have to transfer to 59.7% stake helb by it in State Bank of India (SBI) to the government, is currently working out modalities for the purpose in consultation with the finance ministry."It is a fact that the shares are being transferred to the government. We are working on the modalities of share transfer," Vinod Rai, banking secretary, ministry of finance, said after the cabinet decided to amend SBI Act to enable the bank to tap the capital market for raising funds.The proposed amendment seeks to empower the bank to issue preference shares and bonus shares.Once the SBI Act is amended, the bank will be authorised to increase the number of managing directors and executive directors so that it can discharge its functions more efficiently since the operation of the bank has expanded manifold over the years, Rai said.Presently, the bank has one chairman and three managing directors. After the the amendment is through, there would be no cap on the number of managing directors, he said.In a bid to give more flexibility to the board of directors and improve corporate governance standards in public sector banks, the Parliament recently passed the Banking Companies (Acquisition and Transfer of undertakings) and Financial Institutions Laws (Amendment) Bill.
