Banks Board Bureau (BBB) is an autonomous advisory body created by the government to enhance the governance of the Public Sector Banks and state-owned financial institutions. The most popular function of the BBB is to recommend the whole-time directors as well as non-executive chairpersons of public sector banks (PSBs) and state-owned financial institutions.
- The BBB was created after the recommendations of the Committee to Review Governance of Boards of Banks in India (Chairman -PJ Nayak Committee – 2014).
- The main objective of the creation of BBB was to empower the boards of the Public Sector Banks.
- It was created in February 2016 and started functioning from April 2016.
- It is an autonomous recommendatory body.
- A search Committee including the RBI Governor recommends the names for the appointment of BBB members.
- The six-member BBB panel has three government officials and three experts, of which two are from the banking sector.
Following are the main functions of the BBB.
- Responsible for the selection and appointment of Board of Directors in PSBs and FIs (Whole-time Directors and Non-Executive Chairman);
- Advise the Government on matters relating to appointments, confirmation or extension of tenure and termination of services of the Board of Directors of the above-mentioned levels.
- To advise the Government on the desired structure at the Board level, and, for senior management personnel, for each PSB and Financial Institution (FI).
- To help banks to develop a robust leadership succession plan for critical positions that would arise in future through appropriate HR processes including performance management systems.
- To build a data bank containing data relating to the performance of PSBs/FIs and its officers.
- To advise the Government on the formulation and enforcement of a code of conduct and ethics for managerial personal in PSBs/Financial Institutions.
- To advise the Government on evolving suitable training and development programmes for management personnel in PSBs/FIs; and
- To help banks in terms of developing business strategies and capital raising plan etc.