The war against bank defaulters in the world’s sixth largest economy has intensified with the Indian government authorising the CEOs of public sector banks to make request for issuance of look-out circulars (LOCs) to the ministry of home affairs against bank defaulters who could leave the country for good. Used at immigration counters at international airports, an LOC checks whether a traveling person is wanted by the police. At least four big bank defaulters and fraudsters have left India since March 2016.
The sovereign is the supreme and the government is its executive agent. One must appreciate the autonomy of the Indian central bank in that context. Period.
One doesn’t need to be a soothsayer to predict that the December 5 monetary policy of the Reserve Bank of India (RBI) will be a non-event. But no one is sure what’s going to happen today when the RBI central board meets in Mumbai to discuss issues on which both the central bank and the finance ministry have chosen to wash dirty linen in public through tweets, speeches and selective leaks to media. (I am not getting into the niceties of who hits first and who retaliates.
In the last week of October, Yes Bank Ltd sent a note to stock exchanges saying the search panel looking for a successor to the bank’s MD and CEO Rana Kapoor -- whose term ends on 31 January 2019 -- has finalised “the potential candidate profile”. Korn Ferry, a management consulting firm which is assisting the selection committee of the bank’s board in evaluating both internal and external candidates, “also shared a representative list of candidate pool, based on initial industry mapping". Who can succeed Kapoor? If you keep the insiders out, the list of probables is very slim -- Gunit Chadha, former Asia Pacific CEO of Deutsche Bank AG; Sanjay Nayar, a former Citibanker and now CEO of KKR India; Pramit Jhaveri, head of Citibank NA in India; and Rajeev Jain, managing director of Bajaj Finance Ltd.
In Indian central bank’s 83-year history, two governors resigned before their terms ended -- Sir Osborne Smith (in 1937) and Sir Benegal Rama Rau (1957). While Smith couldn’t stomach the government’s wont to dominate the central bank, Rau resigned due to differences with then finance minister T.T.