21 March 2017 Current Affairs: In an unprecedented move, the Centre has swapped the Chief Executive Officers (CEOs) of state-owned Indian Bank and IDBI Bank.
Mahesh Kumar Jain, who was Managing Director & CEO at Indian Bank, has been appointed as Managing Director & CEO of IDBI Bank, which is now in some financial trouble and faced with several legacy issues.
Jain was named Indian Bank chief in November 2015. Kishore Piraji Kharat, who was appointed as IDBI Bank CEO in August 2015, has now been appointed as Managing Director and CEO of Indian Bank.
Jain will assume charge of IDBI Bank at a challenging time when the bank's morale is down following the recent arrest of some of its top officials. Also, the huge Rs. 2,255 crore loss in December quarter has also made things difficult for this PSB.
Till now, one could mostly see chief executives of smaller public sector banks getting elevated to larger public sector banks. This is the first time a swap of CEOs between almost equal sized banks is being undertaken, say banking industry observers
Some banking industry observers are also dismayed at sidestepping of good governance norms as enunciated in Listing Obligations and Disclosure Requirements (LODR) and absence of Boards involvement in the decision making process.