Reserve Bank of India has fixed the tenure of MD, CEO and whole-time director (WTD) in a private sector bank, which is 15 years. The maximum age of such functionaries should be 70 years.
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These directives are part of the instructions issued by the RBI with regard to the chair and meetings of the board, composition of certain committees of the board, age, tenure and remuneration of directors, and appointment of the WTDs.
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The RBI said it would come out with a Master Direction on Corporate Governance in banks in due course. “The post of the MD & CEO or WTD cannot be held by the same incumbent for more than 15 years.”
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“Thereafter, the individual will be eligible for re-appointment as MD & CEO or WTD in the same bank, if considered necessary and desirable by the board, after a minimum gap of three years, subject to meeting other conditions,” it said.
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It is also mentioned that during this three-year cooling period, the individual shall not be appointed or associated with the bank or its group entities in any capacity, either directly or indirectly.
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With regard to the upper age limit for MD & CEO and WTDs in the private sector banks, the RBI said that no person can continue in such positions beyond the age of 70. The maximum age limit for chairman and non-executive directors has been fixed at 75 years.
