Days after the Reserve Bank of India (RBI) barred members of the parliament (MPs) and legislative assembly (MLAs) from holding the post of managing directors (MDs) or whole-time directors (WTDs) in urban cooperative banks (UCBs), Nationalist Congress Party (NCP) chief and former union minister Sharad Pawar, on Sunday, said if the RBI has taken a policy decision, it needs to be accepted.
“RBI is the apex body that oversees banks and financial institutions. I will seek details with regards to RBI’s move to prohibit MPs and MLAs from holding the post of MDs or WTDs. However, if RBI has taken a policy decision, it will have to be accepted,” said Pawar. The RBI directive, which was issued on June 25, will be applicable to UCBs.
RBI had exempted UCBs with a deposit size of less than Rs 100 crore from the requirement of seeking its prior approval for the appointment / re-appointment / termination of appointment of MDs or WTDs. Under the propriety criteria, the person to be nominated as MD or WTD shall not be engaged in any other business or vocation; shall not hold the position of MP and MLA or in a municipal corporation or other local bodies; and shall not be a director of any company other than a company registered under Section 8 of the Companies Act, 2013.