RBI Mandates Private Sector and Foreign-Owned Banks to Appoint Minimum Two Whole-Time Directors, Including MD & CEO, for Effective Governance

Summary:

The Reserve Bank of India (RBI) has issued a circular (RBI/2023-24/70) to all private sector banks and wholly-owned subsidiaries of foreign banks, dated October 25, 2023. The circular emphasizes the importance of establishing an effective senior management team in banks to navigate ongoing and emerging challenges. To achieve this, banks are advised to ensure the presence of at least two Whole-Time Directors (WTDs), including the Managing Director and Chief Executive Officer (MD&CEO), on their Boards. Banks that currently do not meet this minimum requirement are requested to submit their proposals for the appointment of WTD(s) within four months from the date of issuance of this circular.