India opens SBI's MD role to private sector for the first time

The Government of India has opened senior leadership positions in public sector banks (PSBs), including the Managing Director (MD) post at the State Bank of India

(SBI), to private-sector professionals, according to an official communication from the Appointments Committee of the Cabinet (ACC).

Earlier NDTV Profit and Business Standard reported the move.

The revised consolidated guidelines, which supersede all previous ACC directives on PSB appointments, allow private-sector candidates with at least 21 years of professional experience, including 15 years in banking, to compete for top roles.

Candidates must have held at least two years at the board level or three years at the highest level below the board.

For internal PSB positions, Deputy Managing Directors (DMDs), Executive Directors (EDs), and MD&CEOs with sufficient tenure remain eligible. Selection will be carried out through the Financial Services Institutions Bureau (FSIB), which may engage HR agencies for preliminary behavioral and competency assessments.

APARs will not carry any weight in scoring; candidates are evaluated on performance during interactions with FSIB.

Clearances from relevant authorities—including the Reserve Bank of India and, for public-sector officers, the Central Vigilance Commission—are mandatory before submission to the ACC.

Terms of office, salary, and superannuation remain governed by existing laws, such as the SBI Act, 1955, and the Nationalised Banks (Management and Miscellaneous Provisions) Scheme.

Officials noted that the first vacancy for the SBI MD post under these guidelines will be treated as “open,” allowing private-sector professionals to apply, while subsequent vacancies will initially be reserved for internal PSB candidates.

The guidelines also specify procedures for waiting lists, additional charge assignments, and penalty disqualifications.

The government described the reforms as aimed at expanding the talent pool, enhancing transparency, and promoting merit-based competition in the leadership of public financial institutions.