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BBB recommends critical measures for improving PSBs

By IndianMandarins- 22 Jan 2019
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The government has reportedly initiated the measures to implement key recommendations of the Banks Board Bureau (BBB)

 

Professionalizing the boards of PSBs and bringing in experts in risk management, information technology, and human resource management are said to be the top points of the BBB's recommendations.  


It has also advised that PSBs be asked to adopt best practices from both private banks and global financial institutions and strengthen internal controls and risk-management practices.

 

In its recommendations, the BBB has also suggested that a nomination and remuneration committee (NRC) should be set up in banks, along the lines suggested by the Companies Act, 2013. Another recommendation is to reconstitute the management committee of the board which takes decisions on large value loans.

 

In the light of the BBB's recommendations, the government is reportedly looking at how to strengthen the risk-management committee, which should be given the mandate to set a definite matrix for various credit underwriting activities. It is also considering how to firewall the audit committee of the board so that full-time directors are not a part of it. 

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