FSIB sets in motion process to find Khara’s successor at SBI

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The Financial Services Institutions Bureau (FSIB) will interview Managing Directors of State Bank of India (SBI) on Tuesday to pick one of them as a successor to Dinesh Kumar Khara, who will retire as Chairman of India’s largest Bank in August 2024.

Khara took charge of SBI as Chairman on October 7, 2020, for three years. On October 5, 2023, the Government extended his term of office till August 28, 2024. SBI has four Managing Directors (MDs). The top three contenders for the corner office in SBI are – Challa Sreenivasulu Setty (MD since January 20, 2020), Ashwini Kumar Tewari (January 28, 2021) and Vinay M Tonse (November 2023).

Alok Kumar Choudhary was elevated as MD in June 7, 2022, and will retire on June 30, 2024, about two months before Khara demits office. The Government usually appoints SBI Chief for three years. Khara will turn 63 on August 28, 2024.

The Government will need to appoint two MDs in SBI once one of them is elevated as Chairman in August and one retires in June. Currently, SBI has 17 Deputy Managing Directors (DMDs) helming various central office departments. There are also a few DMDs on deputation to various subsidiaries as MD & CEO.

Once two new MDs are appointed, the Bank will internally fill two DMD positions from among the 70-odd Chief General Managers (CGMs) in the Bank.

FSIB was constituted effective from July 01, 2022, by Central Government for the purpose of recommending persons for appointment as whole-time directors (WTDs) and non-executive chairpersons (NECs) on the Boards of financial services institutions and for advising on certain other matters relating to personnel management in these institutions.

The functions of the Bureau are — to recommend persons for appointment as WTDs and NECs on the Boards of Directors in Public Sector Banks (PSBs), financial institutions (Fis) and Public Sector Insurers (PSIs); to advise the Government on matters relating to appointments, transfer or extension of term of office and termination of services of the said directors.

FSIB also advises the Government on a suitable performance appraisal system for WTDs and NECs in PSBs, FIs and PSIs.