Finmin restricts use of bank vehicles for nominee directors

The government nominee directors have been asked by the Finance Ministry not to use bank vehicles for purposes other than attending its board meeting and bank-related works.
"It has been observed that at times, the government nominee directors avail the facility of travel expenses from their banks for official visits which is not related to the bank board on which the officer is appointed Government Nominee Director," a Finance Ministry office memorandum said.
"Therefore,...In order to ensure that the laid down procedures are followed, Government Nominee Director may avail such a facility only for attending the meeting of board of the concerned bank or its committee meeting," it said.

"Any exception to be made should have been approved by Secretary, Department of Financial Services (DFS)," it added.
To professionalise bank boards, the government had recently revamped the procedure for appointment of non-official directors and will invite online applications from candidates.
A high-level search committee would go through the applications and recommend names to the Government for approval, according to revised norms.
"Non-official Directors (NoDs) could be appointed for maximum six years or two terms," it said.
The changes in the appointment procedure would "professionalise the Boards and further provide required skill sets to improve the quality of deliberations on the Boards of these banks leading to efficient management of these banks and further leading to better profitability ratios.