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RBI directive mandates additional senior leadership roles in banks

EditorRachael Rajan
Published 2023/10/25, 20:26
© Reuters.

In an effort to fortify their senior leadership, banks are now required by the Reserve Bank of India (RBI) to appoint an additional Whole-Time Director (WTD) alongside the Managing Director (MD) on their boards, according to a directive issued recently. This initiative is expected to navigate the increasing challenges and complexities within the banking sector effectively.

The enforcement of this rule is in line with regulatory stipulations that enforce an age cap of 70 for MDs and CEOs in private banks. This move is expected to simplify succession planning, ensuring leadership continuity within these financial institutions.

The board of each bank will decide the number of WTDs based on factors such as operational size, business complexity, and other pertinent aspects. Banks have been given a strict four-month timeframe to comply with this directive.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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