India is considering raising the retirement age for the heads and managing directors of state-owned banks, which control more than 60 percent of the banking system’s assets, a government official said Saturday (26/8).
The government is considering a proposal to increase the age limit for the chairman of the state’s largest bank, the State Bank of India (SBI) to 65 from 63, and for the principal directors of other state-owned banks to 62 from 60, the official said.
SBI is regulated by laws and regulations that are separate from other state-owned banks.
“The plan is still being considered. A final decision has not been made,” said the official, who declined to be named as discussions were still ongoing.
The age limit for heads of state-owned banks is much lower than for their counterparts in the private sector, who retire at age 70 and have a longer tenure. Analysts often cite age limits as a reason for the lack of strategic sustainability at state-owned banks.
Leaders of state-owned banks are generally appointed for three years and can be given an extension based on their performance.
Separately, the government plans to grant a 10-month extension to current SBI Chair Dinesh Khara, who is scheduled to retire at the end of October, the official said. (ah/ft)