In a rare instance, the Reserve Bank of India (RBI) has made certain adverse observations regarding the conduct of a senior executive chosen to head a state-owned bank.
The banking regulator has made certain remarks in a letter on the conduct of Asheesh Pandey, currently an executive director (ED) at Bank of Maharashtra (BoM), and has asked the finance ministry to consider them while evaluating his candidature for the managing director position, said multiple people aware of the development.
Pandey, age 54, is shortlisted for the role of MD & CEO at Indian Bank, but still requires final approval from the Appointments Committee of the Cabinet (ACC).
The ACC comprises the Prime Minister and the home minister.
A government official confirmed that it received a communication from the RBI in April and that along with other comments, it has been forwarded to the competent authorities.
“We have responded to the communication from the RBI and the Department of Personnel and Training (DoPT) on this matter,” he said, adding that the final decision will be taken by the ACC.
Asheesh Pandey and RBI did not respond to ET’s request for comments.
In April, the RBI in a communication to the finance ministry pointed out that in September 2023 during an exit meeting to discuss supervisory findings, the ‘behaviour and conduct’ of Asheesh Pandey was ‘found not befitting his position and responsibilities concerning regulatory compliance.’
The exit meeting is the final meeting to iron out differences between the RBI and the bank over the concerns raised by the regulator in the annual inspection report.
The exit meeting that RBI is referring to in its letter was also attended by AS Rajeev, who was then the MD and CEO of the bank along with Pandey. Currently, Rajeev is the Vigilance Commissioner.
The RBI gave its observations to the Department of Financial Services (DFS) in the same month when the Financial Services Institution Bureau (FSIB), an arm of the central government that selects top management at public sector undertakings, issued a statement recommending Pandey for the MD and CEO position at Indian Bank.
“The FSIB has representation from the RBI, which was apprised of the matter before selection,” said another government official. M Rajeshwar Rao, deputy governor of Reserve Bank of India, is a member of FSIB since November 2020.
Shanti Lal Jain, the current head of Indian Bank will complete his term in August 2024. He is likely to get an extension till December, the above quoted official said.
“DFS may like to suitably factor the above comments while considering the candidature of Pandey for the post of MD & CEO in public sector banks for the vacancy year 2024-25,” it noted.
ET has reviewed that letter.
Prior to joining the Bank of Maharashtra, Pandey was chief general manager and chief operating officer of Union Bank of India.
