Q. With reference to the ‘Banks Board Bureau (BBB)’, which of the following statements are correct?

  1. The Governor of RBI is the Chairman of BBB.
  2. BBB recommends for the selection of heads for Public Sector Banks.
  3. BBB helps the Public Sector Banks in developing strategies and capital raising plans.

Select the correct answer using the code given below:

  • 1 and 2 only
  • 2 and 3 only
  • 1 and 3 only
  • 1, 2 and 3

Answer: (b) 2 and 3 only

Banks Board Bureau (BBB)
  • Banks Board Bureau (BBB) is a self-governing autonomous body of the Government of India tasked to search and select apposite personages for Board of Public Sector Banks, Public Sector Financial Institutions and Public Sector Insurance Companies and recommend measures to improve Corporate Governance in these Institutions.
  • Banks Board Bureau headquarter is at the Central Office of Reserve Bank of India, Mumbai and started its functioning on April 1, 2016.
    • The Banks Board Bureau (BBB) has its genesis in the recommendations of ‘The Committee to Review Governance of Boards of Banks in India, May 2014 (Chairman – P. J. Nayak)’.
  • BBB was a part of the seven-point strategy of the Indradhanush Mission aimed at revamping the Public Sector Banks. It is an autonomous body of officials and distinguished professionals for the PSBs  (Public Sector Banks).
    • The Governor of RBI is not the Chairman of the Bank Board Bureau (BBB). The Appointments Committee of the Cabinet in its discretion appoints the Chairman and members of the BBB.
  • The Ministry of Finance has the final decision-making authority on the appointments in consultation with the Prime Minister’s Office.
  • The mandate of the Bureau includes:
    • To recommend the selection and appointment of Board of Directors in Nationalised Banks, Financial Institutions and Public Sector Insurance Companies (Whole Time Directors and chairman);
    • To advise the Central Government on matters relating to appointments, confirmation or extension of tenure and termination of services of the Directors of mandated institutions;
    • To advise the Central Government on the desired management structure of mandated institutions, at the level of Board of Directors and senior management;
    • To advise the Central Government on a suitable performance appraisal system for mandated institutions;
    • To build a data bank containing data relating to the performance of mandated institutions and its officers;
    • To advise the Central Government on the formulation and enforcement of a code of conduct and ethics for managerial personnel in mandated institutions.
    • To advise the Central Government on evolving suitable training and development programs for managerial personnel in mandated institutions
    • To help the banks in terms of developing business strategies and capital raising plan and the like;
    • Any other work assigned by the Government in consultation with Reserve Bank of India.