Financial Daily from THE HINDU group of publications
Wednesday, Apr 03, 2002
Financial Daily from THE HINDU group of publications Wednesday, Apr 03, 2002 |
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Opinion
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Letters Role of bank directors
A recent CBI report (Business Line, March 30) finds that the present role of nominated directors in banks is confined to "merely signing on the dotted line on the minutes drawn up by the staff of the CMDs' secretariats attached to the banks." This makes one wonder about the future of the Indian banking system. Whether the director is elected under any clause (including the employees' representation clause), or nominated by the Government, the RBI or some other body, it is his primary duty to protect the bank by enforcing sufficient checks. In the case under reference, the CMD is reported to have been involved in malpractices in 34 of the 44 cases investigated by the CBI. As rightly pointed out, the nominee director of the Government or the RBI is responsible for protecting the bank as well as the financial system. The mounting frauds and malpractices in various banks warrant strict bank surveillance. The nominee directors should play a pivotal role in this. C. P. Velayudhan Nair
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