PNB chief leads race for RBI Dy Governor's post

Punjab National Bank Chairman and Managing Director K C Chakraborty has emerged as the frontrunner for the post of the fourth deputy governor of the Reserve Bank of India (RBI).

Sources said that over the next few days, the selection committee headed by RBI Governor D Subbarao will send the panel of three bankers, from among the five interviewed, to the appointments committee of cabinet (ACC).

There was, however, no clarity on who the other two contenders would be, with the names of Bank of India Chairman T S Narayanasami and IDBI Bank Chairman Yogesh Agarwal doing the rounds. Typically, ACC, headed by the Prime Minister, finalises the candidate from a panel of three names with the selection committee providing its preference.

The government and the central bank are keen that a replacement for V Leeladhar, whose term came to an end in December, is finalised before the general elections are announced.

Chakraborty, whose term at PNB is scheduled to end on June 30, 2012, has been assured a tenure till he turns 60, government sources said. This would mean that Chakraborty would be able to function in RBI for more than three years.

With the government looking for a candidate who was willing to settle for a three-year term only, three of the originally-shortlisted seven public-sector bank chiefs gave their consent. Chakraborty was among those who did not want to shift to Mint Road initially.

But with the committee deciding to adopt a flexible approach, Chakraborty and Bank of Baroda Chairman and Managing Director M D Mallya turned up for an interview conducted in New Delhi yesterday. However, Union Bank of India Chairman and Managing Director M V Nair could not make it for the interview.

Last week, the selection committee had interviewed Narayanasami, Agarwal and Canara Bank Chairman and Managing Director A C Mahajan. While Narayanasami is due to superannuate at the end of May, Agarwal and Mahajans terms end next year.

State Bank of India Chairman O P Bhatt was the seventh candidate to have been shortlisted by the panel.

Apart from Subbarao, the selection committee consists of Finance Secretary Arun Ramanathan, Personnel Secretary Rahul Sarin, former SBI Chairman Janki Ballabh and former RBI deputy governor Vepa Kamesan.

This is the first time that the government has set up a selection committee to appoint a deputy governor. The move follows a suggestion from the High Court that a more transparent system of appointment should be followed.