CALCUTTA, July 10: The Bank of Rajasthan's board is yet to approve the appointment of S K Sapru as its managing director. Sapru, whose name was proposed by the board and cleared by the Reserve Bank of India, was to have taken over last month.

According to sources in the bank, the board is reluctant to accept Sapru as its new MD.The apex bank had cleared Sapru's name during the first fortnight of June. Sapru, who is the chief general manager with the State Bank of India, Lucknow, was supposed to have joined the Bank of Rajasthan as its managing director on June 25, following the retirement of N M Chordia.

The bank's board met on June 26, but sources said that the appointment of Sapru did not figure on the agenda. Under Section 10BB of the Banking Regulation Act of 1949, the Reserve Bank of India has to clear appointments to the posts of managing director and chairman in private sector banks after ratification by the bank's board.

As the bank itself picks the candidate from a panel, it usually does not change its mind after the RBI clearance.

A senior official of the RBI's department of banking operations and development (DBOD) said that if any bank did not wish to appoint a particular person as its MD it should not have sent in his name in the first place.

While the apex bank does not have powers to penalise the bank in this case, "we can certainly haul them up for unethical practices". Or the RBI can ask for a fresh panel to be formed and another candidate's name to be forwarded.Sapru was selected following an advertisement in newspapers in February this year. The bank has a chairman, R S Rathore, who does not wield any executive powers. The managing director is also the chief executive officer.

In the absence of an MD, some senior executives of the bank are running the show while all major policy decisions are referred to the board.

Some of the officers of the bank have called for creation of a single post combining the chairman and chief executive officer.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.