maximum tenure The age of CEO and MD of public sector banks has been raised to 10 years, a move that will help the bank government To retain the best talent in the banking sector. According to a government notification dated November 17, 2022, the term of appointment has been extended from the earlier 5 years to 10 years, subject to the retirement age of 60 years.

Earlier, MD or Executive Director of a Public Sector Undertaking (PSU) bank was eligible for a maximum of 5 years or 60 years, whichever is earlier. also applies to whole-time directors of All Central Public Sector Enterprises (CPSE).

“A whole-time director, including the managing director, shall devote his whole time to the affairs of the nationalized bank and such initial term shall not exceed five years and shall be extendable to a total term including the initial term not exceeding 10 years , after consultation with the Central Government, as the case may be Reserve Bankspecify and shall be eligible for reappointment,” it said.

The amendment will be called the Nationalized Banks (Management and Miscellaneous Provisions) Amendment Scheme, 2022. The Central Government has the right to terminate the tenure of whole-time directors including the Managing Director at any time before the expiry of the specified period by giving a notice of not less than three months in writing or three months. Month’s salary and allowances in lieu of notice.

This decision of the government will help banks to retain the talent who climb the ladder of full time directors at an early age of 45-50 years.

At present, there are several whole time directors of PSU Bank Who entered the board at a young age. They will benefit from the amendment.