Sunday, January 31, 2016

Role Of RBI In Stopping Scam In Public Banks

The RBI has asked Bank of Baroda to conduct a bank-wide review of the outward remittances to rule out similar wrong doings at other domestic branches and submit a report thereof to it.RBI did it so when Rs.6000 crore scam came on surface in foreign exchange remittance in Bank of Baroda. The RBI was asked by Government of India to provide details of action being taken by it to check fraudulent forex transactions by banks.

A circular has been issued to all scheduled commercial banks, advising them to conduct a thorough internal audit and place the report before audit committee of the board of the respective banks and to forward the summary of findings to RBI. This guidelines issued by RBI seems to be totally ridiculous and self defeating exercise.

I would like to mention here that as per existing guidelines every bank is duty bound to conduct internal audit of every branch periodically. Many types of audits are carried out depending upon the nature and volume of business taking place in a branch. Internal auditing system is already in force in very PSU bank.

In addition to it, each bank use to carry out concurrent audit of big branches where volume of business is huge . There is a practice of Statutory audit in every bank in which RBI nominated tam of Chartered Accountant conduct audit of specified branches periodically. In addition to all, every branch is subjected to revenue audit of almost all branches to stop leakage of income.

In such position , circular issued by RBI again to advise all banks to carry out internal audit of their branches and submit a report to RBI to rule out fraudulent remittance of foreign exchange in future appears to be a simple formal and casual taken by RBI to save itself from charges of omission and negligence.

Banks which have been committing fraudulent remittances through their branches for years and decades despite all guidelines not to do so in light of KYC guidelines and Anti-Money laundering Act will never say that their other branches are involved in such evil work or will not commit such mistake in future. It is just like police asking thieves to inspect the act of stealing and submit the report to ensure that in future act of stealing will not take place.

In fact it is total failure of RBI in ensuring compliance of its rules and guidelines . It is the duty of RBI to inspect every branch from time to time as it used to do a few decades ago. RBI has failed to ensure health of assets in PSU banks and totally failed to stop losses caused to bank due to frauds and malpractices.

It has been observed that quite often the internal inspection machinery in banks has failed to highlight and pinpoint the existence of gross and serious irregularities such as improper credit appraisal, disbursement without observing the terms of sanction, failure to exercise proper post-disbursement supervision, even suppression of information relating to unauthorised excess drawals allowed, kite flying in bills and cheques, etc. or bring to light frauds. In addition to it , it is also a fact that even if auditors try to write such lapses in their reports, they have to face the consequences in form of verbal firing or torturous transfers or rejection in promotion processes.

It is ground reality of all auditors and vigilance officials that officers who are supposed to expose the irregularities and punish the culprit are engaged in saving the culprit or forced to save the culprit. This is why cases of fraud , bad lending , irregularities in operation and other evil activities are continuously increasing.

The internal inspection reports rarely make any adverse comments on the failure of officials of Controlling/Head Offices. In fact internal auditors do not submit information related to serious irregularities in their audit report in fear of action from Chief of Audit Committees . The failure of the internal inspection machinery is not attributable only to the incompetence of the internal inspection personnel the casual manner in which the work is carried out and lack of follow up of the inspection but also to pressure from higher level officials not to write about high value bad assets or about frauds detected during the period of inspection. Entire management try to hide irregularities as long as possible to save their colleagues. This is also a fact that personnel who cannot otherwise be deployed in other sensitive/critical areas more often staff the inspection/audit department.

RBI has been silent spectators of all evil practices .They have stopped their work of surveillance either at their own or under pressure from Central Government or in greed of quick promotion or in greed of some gifts from some other corners. Similarly entire team of top officials in every bank try to put carpet on malady instead of cleaning it. But , whatsoever may be the reason behind recurring instances of scams , it is always poor taxpayer and poor depositors who have to suffer the consequences of mismanagement or non management of malicious management of banking .

Country have witnessed several scams taken place in public banks in the past . We have seen how reputed team of auditors gave certificate of best accounting practices to Satyam Computers and we know how big corporate cause huge loss to banks by submitting fabricated and manipulated financial statements to these banks.

It is disheartening to note that neither RBI nor management of Public sector banks have taken any serious note of any loss, any fraud, any scam or any loss in bad assets. Bankers are habituated to write off bad loans to clean balance sheet giving excuse of economic recession or global recession in all the cases of default. In fact bankers have never tried to detect evil role of human being who play lead role in creation of bad assets or fraud or in scam related to Foreign exchange remittance .

A few years ago , similar type of cash scam was exposed in other banks . But RBI never acted seriously against erring officials to send the clear message down the line that officers indulged in malpractices will not be spared.

Bank of Baroda scam: RBI tells banks to conduct internal audit-Business Standard-31.01.2016

Central bank wants to put an end to fraudulent foreign exchange transactions

Negative Interest Rate’ announced in Japan
The Bank of Japan, Japan’s Central Bank, has introduced ‘negative interest rate’ regime.   The Eurozone already has negative interest rates, but for Japan, the third largest economy in the world, this is the first time it has resorted to this step. It’s a move that has been on the cards for Japan’s stagnating economy for well over 10 years.

The decision to go negative came after a narrow 5-4 vote at the Bank of Japan's first meeting of the year on Friday.

"The BoJ will cut interest rates further into negative territory if judged as necessary," the Bank of Japan (BoJ) said, adding it would continue as long as needed to achieve an inflation target of 2%.  The December core inflation rate was shown to be at 0.1% - far below the central bank's target

Negative interest means that the central bank has fixed a benchmark rate of -0.1% and the commercial banks in Japan will be charged by the central bank for some deposits.

This move is aimed at dissuading the banks from keeping their surplus funds with the central bank.  So, the commercial banks will be pressurized to lend more to industries and trade and also for individual consumption, to fight the economic deflation.

With the country’s economy in a tailspin, the government is desperate to increase consumer spending and at one point, it issued shopping vouchers to stimulate demand.

The negative interest rate will not apply to the bank depositors.  Nevertheless, the commercial banks whose margin is already under stress will be compelled to pass on this additional burden, at least in part, to their depositors in course of time.  In such an eventuality, many of the depositors will stop saving with banks and look for other alternative avenues.

With the economy not in good shape, people will hesitate to invest in risky sectors.  The other alternative is to spend more and this is what the government precisely wants them to do.

We all know how consumerism has ruined countries like United States where domestic savings have reached a level of $138.73 per GDP of $1,000, which is lower than a small country like Sri Lanka ($146.13 per GDP of $1,000).

Economists the world over agree that interest rates by themselves cannot determine inflation/deflation and there are other factors like domestic savings, demand for goods and services, employment creation, taxation policies of the government, foreign exchange inflows and outflows, forex rates, external borrowings, overseas lending and investments by the government and the corporate sector and public expenditure.  Corruption and generation of black money also affect the economy.  In addition, education, health, longevity of an average citizen etc. also have a bearing on the economy.
In a situation of deflation, creating incremental demand for goods and services will be a great challenge. Even if the cost of borrowing is very low, entrepreneurs will show reluctance to borrow because they are not sure of selling their goods and services to break even and sustain in the well developed and highly competitive market.

In a press conference, the BoJ's Governor Haruhiko Kuroda said the weakening growth rate of the global economy was the main factor behind the move: "Japan's economy continues to recover moderately and the underlying price trend is improving steadily... further falls in oil prices, uncertainty over emerging economies, including China, and global market instability could hurt business confidence and delay the eradication of people's deflationary mindset."

Earlier in the day, fresh economic data had again highlighted concerns over economic growth. Asian shares jumped and the yen fell across the board in reaction to the announcement. Japanese banks saw their shares drop on the news and as lenders, they are likely to see their margins squeezed even more.

It may be recalled that there are too many banks in Japan and because of lending below the market rates to the corporate sector without matching collateral security, many banks have failed in recent times.
Some analysts have expressed their doubts over how effective the rate cut will be.

Date: 30-01-2016                                                                                                            pannvalan

Promotion Policy In Public Sector Bank

Sub:-New Promotion Policy
– Amendments Proposed By Some Of Officer's Association.
Suggestions are:
1. Normal Track (65-55%) & Fast Track (35-45%)

2. Changes in percentage of weightage.

3. Increase in Educational Qualification marks.

4. Increase in Job Responsibility Marks with addition of marks for Deputy Branch Manager/Accountant/Deputy Regional Head. 

5. Career Path restriction liberalized for specialist officers.

6. To reduce debar period in case of Refusal to accept promotion.

7. 75% average marks in appraisal for last 5 years. 8. Federation has also requested the Top management to decide cut-off date in such a manner that maximum aspirants can apply for promotion. 

I request you all to submit your valued suggestion on above point or suggest best ways to make promotion policy more appropriate and justified . Please Give your valued suggestion on how  to stop misuse of power by higher bosses. Please give suggestion on how to stop culture of flattery and bribery.

In my opinion, there is no need of having two tracks namely normal and fast track. Both of them have provision for interview . Any officer can be rejected in interview even if he or she  has all talent and on the other hand a bad officer who is yesman and flatterer of higher bosses can be selected for promotion. There is no check point to stop such misuse of power by higher bosses.

It is not uncommon in India that a powerful person misuse his power to give favour to kith and kin of his caste or his community or his region or his religion. Selection of an officer depends largely on perception and conception of  higher bosses who carry out and who plays lead role  in promotion processes.

Similarly change in marks for various parameters such as educational qualification and  job responsibility become insignificant and ineffective when an appraiser with biased mind or corrupt mind give less marks to a talented and good performing  officer in AAPR or gives less marks in Interview.

Role of 5 to 10 marks in educational qualification or 10 to 15 marks in job responsibility are negligible as compared to marks in AAPR and Interview. After lapse of  ten to twenty years , an officer with job  responsibility or with no job responsibility earn almost equal marks and hence become ineffective.

Interview Must Be Abolished for Promotion in Bank

System of Annual Appraisal System is such in bank
which neither appraise understand,
nor assessing authority or reviewing authority understand.
As such AAPR has also become useless exercise in practice.

With reference to new terms of promotion policy for bankers dictated by Ministry of Finance  a few ears ago, I would like to place my views for consideration of bank employees, for union leaders who are supposed to protect the interest of bank employees and for top executives of bank management who have been directed by MOF to frame new policy of promotion for officers.

I would like to say that until there is system of Interview in promotion processes there is no guarantee that whimsical rejection or arbitrary promotions will not take place in Government Banks. Interview is the root of all maladies in all banks and in all government departments. Members of Interview panel more often than not apply their whims to select or reject a candidate ignoring completely the quality and quantity of work done by any particular officer. Various powerful officials are used by candidates as source called as Godfather to win the hearts of members of Interview panel and this give rise to flattery and bribery. As such I feel the system of Interview must be abolished completely.

I feel there is no benefit in conducting group discussion for promotion of any officer in any scale and neither is there any need for having a separate Merit Channel which gives scope of manipulation. During five to thirty years of service, top executive of banks get hundreds of opportunities like meeting, branch visit, correspondence, audit reports which give ample opportunity to judge the quality of an officer who is candidate for elevation. If the higher executives are not able and do not possess enough capability to assess and ascertain the level of proficiency, efficiency, communication skill, , behavior with customers, work performance, style of working, relationship, innovative and creativeness , level of initiative, loyalty to bank, level of corruption, honesty and integrity etc of an officer in span of five to thirty years , how can interview panel members judge all these in a minute or two of time available in Interview with candidate eligible for promotion?

Interview in my view is undoubtedly a tool given to management to reject good officers and whimsically select bad officers for higher assignment on some plea or the other. Same logic applies for all organization and government offices. This is why most of officers promoted to executive cadres are subsequently found to be guilty of various malpractices and later given non-sensitive assignment. It is different that such evil worker or officers get patronage and protection from his mentors sitting at top echelons and due to which they are never punished but always promoted to higher level.

Madu Koda , Harshad Mehta, A Raja, or Suresh Kalmadi succeeded in execution of their ill conceived ideas causing loss to government in tune of hundreds of crores of rupees. They succeeded in their dirty goal only because they could use their power to select flatterers for their team who blindly say yes to every order of Ministers and who do not talk of ideal or safety of the organization. By dint of money power they could earn through the rout of bribe and flattery they could manage the CBI official or vigilance official or inspecting and audit official to conceal their evil works. In the same fashion top bankers select a few flatterers and blind followers who can earn illegal money through bad lending or through ill motivated contractual works and share with them.

Similar is the line of action of top ranked official in banks who manage vital issues and who decide on big value loan proposals. In such position and in such a dirty environment, an honest and talented officer cannot visualize performing as per set procedures ensuring safety and security of the bank. And when the work culture depends on so many extraneous factors which are beyond control of officers there is no merit in talking of merit channel or group discussion or interview.

Root cause of all maladies lies in these delegated powers in top executives which shuts the mouth of good officers and when such culture is prevalent, even policy of whistle blower become futile. Officers who move opposite the line of bosses are transferred to such a critical branch that survival of officer and his family becomes an issue. Can an officer in such critical place of posting with humiliating background behind the scene perform as per his skill or as per his potential and give same growth as an officer posted at comfortable branch? Not at all.

There is no fixed yardstick which can measure perfectly the efficiency, honesty and loyalty of an officer until the intention of assessing authority is bad. It is therefore desirable to give all promotions based purely on seniority and punish officers who commit mistake or train officers who are willing to perform but lacks in knowledge. Same practice is prevalent in central government services as regards promotion and release of increment without stagnation. It is different that again politicians use transfer powers to make or mar the career of an officers for their vested self interest.

I further feel that the method of Fast Tract called as Merit Channel is another scope to bank officers to concentrate of academic knowledge and somehow or the other pass various examinations even by unfair means . In most of the cases officers who are weak in performance but strong in reading and raising knowledge level get success in written test and get promoted from one scale to other scale even though their performance in the field level is dismal, damaging and full of corruption.

Banking service is completely practice oriented and here focus remains on how an officer render service to customers and not on how much knowledge he or she possesses. I agree that one banker should possess adequate educational qualification and it should be ensured at the time of fresh appointment. There are many officers in banks who continue reading even during service period but do not perform at all in the branch they are posted. They know that if they acquire degree they will get better marking not only in appraisal and in interview but also create good impression in the minds of members of Interview panel. Such officers even at work place focus on circulars and make diary but they seldom apply their knowledge to enhance productivity of the bank.

It is true that practice without theory is blind, but it is also true that theory without practice is impotent. It is to be kept in mind that after passing ordeal of written examination, Interview and group discussion, a person is appointed in a bank. Once a person is selected for banking job, it is the duty of bank management to make him perfect in the line of activity he is supposed to work. As per assignment of duties the employees should be trained and motivated.

If banks fail to prepare an officer for particular job, it is the fault of training system and that of department of Human Resource Management and that of Planning Department. It is the duty of bank management to use the bank employee as per his attitude, skill, knowledge, interest and specialization. It is absolutely bad to deprive any office from promotion or even from annual increment if the bank does not have adequate vacancies or when bank fail to ensure good working culture.

Besides if the assessing authorities fail to assess the merit of officers in a period of five to thirty years they cannot do the same in few minutes of group discussion or interview or by placing some questions in written test. Besides it is also bitter truth that the same officer is assessed differently by different assessing authority due to his different level of perception, conception, preferences, love and hate style. Fate of the same person depends less on his or her skill but more on the prejudiced eyes of assessing authority. Same piece of cloth in a cloth shop may be liked by one and disliked by the other. Cloth is same but buyers have different likings and different attitude. God has made it , none is guilty for such multiplicity of attitude, conflict of interests and varity of inclination and deflection.

Many times officer in a bank do not succeed as per expectation of higher management due to situation beyond his control such as there is no adequate manpower in the office he works. Branch has to waste most of precious time in unproductive work like pension payment, No frill accounts as suggested by the government, salary payment of various department.

Interruption by higher bosses in normal functioning by asking various types of reports and statement by adding duties which are not reckoned with in appraisal system for assessment of work performance also adversely affect the efficiency of an officer in a branch.

When his predecessor ( branch head who worked prior to present incumbent )has committed fraud, disbursed loans to bad borrowers without completing required formalities, when Non Performing assets in a branch is huge and the new incumbent officer who has inherited bundle of irregularities has to devote more time on improving housekeeping , on recovery of past loan than in mobilization of new business and on creating better relation with customers. Image built by his predecessor is so bad that customers hesitate to oblige new incumbent and business do not grow as per expectation.

Every Higher bosses has his own liking and disliking. They may compel a subordinate officer verbally to sanction advances to persons of their choice and punish officer if he or she does not abide by verbal instruction. Otherwise best option available to boss is to threaten such officers of transfer to critical places.

Area of posting also plays a significant role in performance. If an officer is posted in bad area he cannot give good output. If the place where he works is crime belt or naxal affected or where security threat is more, growth of business will be at low speed. On the other hand if position of branch is in business concentrated area, bank’s business may also grow at higher speed. Moreover customers also hate going to crowd inflicted area or robbery prone area to avoid cash loss risk or life risk and in such position even good officers cannot perform well.

And so on ------------------------------------

Business Parameter:

Moreover the business of any branch depends on potential of the area also. If an officer is posted at critically remote village or crime prone area or is disturbed mohalla he or she cannot increase business as an officer posted in an area where number of government departments are more, where schools and colleges are more, where the area is in developing stage and government sanctions hundreds of crores of rupees for development, where Multinational companies and big domestic companies are situated etc.

Sometimes multiplicity of banks in a particular area also dampens the prospect of growth. Private Banks offer better ambiance and skilled staff on front level counters backed by a team of marketing personnel whereas PSBs open their branches with one or two staff and place of branch is selected in remote corner so that rental payment is minimum. As soon as a branch of private bank is opened, customers of high standard prefer to switch over to Private Banks.

Branch Managers of branches of various government banks are busy in preparation of reports or statement. VIP Customers are going away from public sector banks to private and foreign banks and on the contrary pensioners, teachers, salaried people, NAREGA beneficiaries etc have become choice customers or compulsion of PSBs.

Even after having customer friendly service charges, customers prefer foreign and private banks because they are fed up with the attitude of employees of government banks. Employees in public sector banks are invariably short of manpower or incompetent or frustrated or busy in preparation of various reports and statements or in recovery of bad loans or busy in serving their bosses etc.

Good customers dislike PSBs, they dislike share of PSBs and prefer buying shares of Private Banks even at higher PE but retired persons, students, low paid salaried people, small retailers etc like going government banks due to lesser service charges. There may be plenty of General Managers, DGMs, AGMs, and CMs in administrative offices but there is no adequacy of staffs in most of the branches to serve the real customers.

Moreover the brainless expansion of banks and opening of new branches to cover up Financial Inclusion has also added fuel to fire. Total number of staff in a government bank is less than what it was ten years ago even though thousands of employees have left the bank, business of bank have grown ten or twenty times and new products have been added to banking industry. There is practically no proper man power planning due to some reason or the other. It is the employees who ultimately bear the brunt of higher management when they fail to perform as per the desire, whims and fancies of his bosses.

Similarly an officer may have influential IAS and IPS officers as his relative, ministers and important government officers as friends and may have linkage with high profile corporate houses. In such position he or she can attract good business for branch he is working as Branch Head. On the contrary some other officer may not have such good connections and so his power to mobilize business may appear low and weak even though he or she is good performer and when customers are happy with his services. Quality of a bank officer should be judged by service extended by his team to bank customers and safety provided to bank assets and not by numerical numbers of growth in deposits and advances.

There are some officers who are good in mobilization of deposits, some have better expertise in lending, some have good marketing skills to sell Non banking products and some other have some other qualities. Every officer cannot be expected to perform similarly in different circumstances. Growth of bank’s business does not depend solely on quality of officers or qualification of officers but also on various other factors which are beyond the control of officer. Policies framed by difference banks is different, quality of higher management in different banks at different level is different, quality and quantity of subordinate staff is different at different branches of different banks and so on……

Suppose an officer is corrupt , he indulges in bad lending and misuses his delegated powers to earn bribe from borrowers he may not only cause bank to incur loss in crores of rupees due to asset financed by him turning bad but he may also accumulate illegal money in huge quantity which he may use to increase business . Corrupt officers can easily motivate government offices to park their surplus fund in his branch. In such position though business growth is attractive there are greater chances of loan going bad and bank incurring loss. Trend of NPA exhibited by various banks in recent past is enough to indicate how corrupt bankers have spoilt the future of bank.

Politicians can talk of interview or that of group discussion or written test. They are habituated to select officers of their choice based on flattery and bribery only .They decide higher posting and higher assignment of an officer based on their relation with the officers, based on how are they treated on their visit to their offices and people of various caste and communities like an officer to be promoted. Politicians give even election ticket to a candidate based on his money power and muscle power. Those who have developed an art of speaking, art of speaking lie and making false promises and delivering false lectures can only win the heart of high command.

The theory of politician if applied in banks and in other public sector organizations, the situation will go beyond control and result which will precipitate will lead the bank from bad to worst. The conception and perception style of politicians in entirely different from that of bankers. Work culture in banks cannot be compared with that of politicians and other government officers who are least concerned with customer service. Politicians have already caused irreparable damage to banks through their vote bank politics during last few decades and it is they who have caused bad assets in Banks to grow to such a large extent. They may be rulers of the country but they have no moral right to preach sermons to bankers.

As such politicians cannot and should not be allowed to dictate policy of promotion. Rather if there are true leaders in various employee unions and in any officers association, they must protest the newly dictated promotion policy as also existing policy and devise a better and transparent promotion policy removing all scope of discretion from all levels. It is disheartening to observe that union leaders have also become puppet in the hands of corrupt executives of government banks.

I once again reiterate that the tools of Interview, written test or group discussion or that of campus recruitment in higher scales as per whims and fancies of top bankers are killing the very work spirit of bank employees and all right thinking bankers must protest and strive for other ways to bring about desired reformation instead of becoming a puppet in the hands of clever politicians. To safeguard banks and to weed away bad performers and corrupt person from the system, I would like to suggest that the work of inspecting officials should be made more effective and that of Industrial Relation Department, Audit department, Human Resource Department, CBI, CVC who take punitive action against erring employees should be made more active and efficient. No delay in punishment should be tool to remove bad performers and isolate them from the system and at the same time No delay in awarding a good officer should be used a tool to spread positive culture in government banks.

Officers in public sector banks in general are disheartened to see fresh guidelines issued by Ministry of Finance on 14th of this month to all public sector banks in relation to promotion process applicable for promoting officers from one scale to other in public sector banks I have been writing since long that as long as there is interview system or appraisal system, no one can guarantee justice for good officers and safety of health of banks. Officers of the rank of General Manager, Deputy General Manager, Asst General Manager ,Executive director and sometimes even Managing directors directly or indirectly have become wealthy by using promotion policy for their vested interest and it is they who have caused rise in bad assets.

It is remarkable to mention here when top management cannot assess the quality of an officer in a span of five to 30 years of actual working of an officer in various branches and various administrative offices, how can they assess the same in 2 to 3 minutes of Interview. Obviously they use the Interview to pick officers of their choice not giving value to merit but to gift and flattery they expect to get in return .

This is why, Flattery to top bosses and bribery to God father has become the easy tool to secure out of turn promotion. Promotion for ambitious officers and on the contrary for good performers, promotion has become a history. There are many such officers who have devotedly worked in various branches and whose work is always appreciated by seniors but they continue to remain in the scale for decades and always rejected in promotions. In fact securing promotion in banks has become a game of money and yesmanism as it is prevalent in government offices and in political circle.

This is why quality of work has deteriorated in all offices in government sector .Health of banks is going from bad to worse year after year though by manipulation and fraudulent data top bankers are cheating regulators for years together.

It is now that rating agencies have started downgrading rating of banks. Quantum of NPA in banks has gone beyond control despite all scrutiny, audit and meetings undertaken periodically and mandatorily by Team of Chartered Accountants, ministers and high level secretaries. For health culture it is necessary to create a sense of, confidence, timely career movement, judicious recognition of performance, and credibility among officers for healthy growth of any organization.

I once again request all responsible officers and ministers to review promotion guidelines and adopt seniority based promotion as prevalent in central services to avoid whimsical and arbitrary promotions. This will create a sense of respectability among officers.

During last 10 to 30 years top ranked officers have used, amended and manipulated promotion policy as per their whims and fancies. They are habituated to pick officer directly from campus in scale I to III, IV and V jeopardizing the future of existing 10 to 30 years experienced officers. Inexperienced officers by dint of their flattery and bribery culture become boss of experienced officers which ultimately results in frustration and demotivation.

Similarly Bank Management  have used policy guidelines issued by Government of India for rural posting to isolate and punish good officers who do not pay bribe and toe the line of bosses. They have reduced or relaxed minimum years of experience from minimum (in fact 10 to 15 years in seventies and eighties )years to 2 to 4 years as per their whims with a malicious intention to select officers of their caste, community, relative and region discarding the future of experienced officers.

In conclusion I may say that top officials of banks have cheated many officers in the name of merit and fast rack promotion process and promoted evil culture in bank. Due to mischievous actions of top officials only, field officers are constrained think it better to flatter the boss than to think for the safety of bank and for customers.

Flattery and yesmanism prevalent in politics and IAS and IPS circle has also become a fashion in public sector banks. I reiterate until the system of interview and internal appraisal is in vogue, there is no hope that good culture and a sense of confidence among good officers will take place and none should dream that revised promotion guidelines will ever strengthen the root of banks.

Government banks have to create strong and reliable Human Resource Team. Banks can prosper and customers can feel pleasure only when officers become loyal to bank and not to bosses. It is common among Indians to misuse powers delegated to them and hence it is desirable to adopt seniority based promotion as happens in case of IAS and IPS officers and for central services. It is possible in bank that a clerk joined in 70-80 became scale IV or V or VI but an officer who joined in the same period is still scale II or scale III.

Moreover powerful persons in all sphere of life give more value to person of their caste, community, region and religion. Justice cannot be expected from majority of powerful persons, exceptional dry honest and sincere persons are few who gives value to quality.

In eighties an officer could get an opportunity for promotion after 10 to 15 years but now banks are giving three to four promotions to officers who have joined bank in 1991 onwards and even after 2000.

Old officers cannot dream of promotions from scale II to III or III to IV because now a day bank directly pick officers in higher scales from campus where sons and daughters of top bankers are admitted and undergoing MBA education. There are hundreds of officers who have not got any promotion during last 20 years whereas there are many such flatterer officers who got three or four promotions in 10 years of service.

There are many officers who have acquired a good number of certificates by honesty or by foul means but they are not fit even for posting as Branch head or on any responsible post. But they are promoted. There are numerous officers who have been promoted despite the fact that serious charges of irregularities have been pending against them for inquiry and investigation.

There are thousands of such officers who have been working in only rural areas for twenty to thirty years but still banks seek relaxation in rural service. Why?

It is because top officials want to promote officers of their choice who can manage WWW for them by hook or by crook but who has never worked in rural areas. If senior officer (interview panel) wants to promote an officer, he will do so by obtaining a declaration from the candidate.

A few years ago government issued incentive scheme for officers posted in North East Area. Bank used this policy also to harass officers who failed to toe the line of boss. It is pity that even incentive are not given to such officers.

As long as top officers are corrupt and ill motivated, there is no doubt all good policies are used for bad purpose and with bad intention.

Management talk of Annual Appraisal report and want to give weightage to marks obtained in these reports. Unfortunately even these reports are manipulated and forged sheet of marks are allotted to officers who are choice of top ranked officers for promotion.

Not only this, same officer is rated differently by different Regional Head when the same officer s posted at different branches in different states. There are some senior officers ( appraising authority) who use to give 90 to 98 marks to his subordinate in annual appraisal reports, some others give marks from 80 to 90 and some are more conservative who give marks below 80 for outsiders and higher for known persons.

In fact the appraising authority in ninety percent of cases do not know how to write appraisal report, neither does he attach any importance to this. It is also true that even reviewing authority do not know how to review the annual appraisal report for his subordinate. As such any value given to marks obtained in annual appraisal reports in promotion processes does not lead to justice.

It is not astonishing that even marks are given on the basis of caste, community, region and religion of the officer who is candidate for promotion or whose appraisal report is being written by appraiser If a north Indian is posted in south , his appraisal report may not be equal to or better than that of south Indians and vice versa..In my opinion marking given in annual appraisal reports has got no linkage with actual performance of the person who is assessed.

In India all decisions, perception and conception of bosses about me or you depend not on how I or you work but depends on what is his angle of consideration who is supposed to assess me or you. I or you may be good for one boss and worst for another boss. In such position it is always desirable that officers are promoted on the basis of seniority without any bias and favoritism.

It is true that there are some disadvantages on introduction of purely seniority based promotion, it is undeniable bitter truth that keeping in view the mentality of top ranked officials in banks the merit and advantages of seniority based promotion is definitely more than that of so called merit or fast track channel based promotion.

I therefore propose following alternative solution may be considered as a better option and not as a fool proof. Interview system in promotion should be stopped forthwith All officers in order of seniority should be promoted. Misuse of power / delegated authority is inevitable until judiciary become quick, effective and honest. When there is a fear of punishment from court , none in the country will dare follow corrupt ways and means.

Unfortunately in India, corrupt officers do not fear court /police because they can force police / court to dance as per their whims and fancies by dint of their money power. It is only honest and innocent fear court and police because they know they can be tortured by police, court and higher bosses for any valid or invalid reason if they so like. We have seen the fate of whistle blowers, Ramdeo and Team Anna.

Many aggrieved officers have filed case in court but judgment does not come even after lapse of years and decades and management take advantage of it. Judiciary is not to provide justice but to perpetuate injustice in nexus with gang of manipulators. As many as ten writs are pending in various High Courts filed by PF Optees (bank officer aggrieved by 9th Bipartite Settlement) against injustice meted out to them through 9th Bipartite Settlement.

It is pity that even Union Leaders supposed to protect the interest of officer members worked in nexus with management clearly stabbing union members from the back. None is reliable. This is India. Hence promotion by seniority as was prevalent in government banks in seventies should be reintroduced and direct recruitment in higher scale should be stopped. Interview should be confined only at the time of fresh recruitment of officers in bank and not for promotion.

Policy applicable for promotion of IAS and IPS officers may also be followed. Seniority base promotion will at least allay all doubts arising in the mind of rejected officers and the system will act as transparent as possible .Officers who have not got promotion for years together will feel elevated and work devotedly for bank.

As of now senior officers neither get annual increment due to stagnation nor do they get chance in promotion because young officers and corrupt officers have become the choice and preference of selecting body. If at all it is found that officers promoted to higher scale is not worth the post he may be given a few chance and finally kicked out of the bank and this decision should be taken by a team of at least eleven senior officers to avoid misuse of this power too. But in no case an officer should be deprived of his right of promotion only because he has got no Godfather. It is shocking to observe that government bank top officials pick up officer directly from campus in scale III or IV who has got not experience of banking b\whereas officers of 20 to 25 years experience with sound track record of performance are sidelined.

Reservation In Promotion:

The Supreme Court has upheld the Allahabad high court’s verdict to quash provision of reservation for Scheduled Caste and Scheduled Tribe (SC/ST) officers and employees in promotions. During last one decade and more , almost all government departments , public sector banks and public sector undertaking in general have given benefits of promotion based on quota to SC/ST and OBC category to please their vote bank , to please a few castiest politicians denying the opportunity to those who possess better record of performance .

I would like to suggest government to continue quota on recruitment if it is unavoidable and warranted to fulfill their social welfare agenda but completely stop quota system in promotion to SC/ST/OBC because this dirty game adversely affects the morale of those employees who perform better , honestly and devotedly but rejected only because they belong to general caste category. In an organization if a person is promoted only because he or she belongs to Dalit category even if he or she is non performer, dishonest and corrupt in his action vitiate the atmosphere, adversely affects the work culture and demotivate those who use to work sincerely and think for the nation as a patriot .It will not be an exaggeration to say that such type of dirty politics has only given rise to cancer of corruption all over the country and resulted in mass disloyalty to nation and the organization the employee serves. Undoubtedly this dirty politics has tarnished the image of the country in international community too.

The only solution to deal with this grave problem arising out of Supreme Court verdict and consequent denial of quota in promotion is to give promotion strictly based on seniority. This system will have dual advantage. Firstly there will not any thrust from SC/ST/OBC section on implementation of quota system in promotion or on issue of ordinance to nullify the impact of Supreme Court verdict .Secondly corrupt top ranked officers will not get opportunity to sell promotion and to whimsically reject any employee in promotion process only because he or she is not flatterer.

Hitherto even corrupt officers used to be elevated to higher post if he or she has a backing of minister, or key politicians or powerful top officers.
Officers who had the blessings of Godfather used to get chance in interview and others used to be whimsically rejected by greedy members of

Interview panel constituted for carrying out promotion processes in various offices and departments

And the most disheartening part of this story is that if officers who were unjustifiably rejected in promotion process by selecting committee used to approach courts for justice but unfortunately in our country such cases remain undecided for decades. In such case, one can say without any doubt that all government offices use courts to perpetuate their reign of injustice. An individual can spend a few thousand rupees to contest his case in High Court or Supreme Court but the defendant being an government office can spend crores of rupees to postpone judgment for an indefinite period. This is why thousands of staff related cases have been languishing in various courts for decades and as a result , an employee has to bear with injustice till his death or retirement.

Lastly but not the least if seniority based promotion is put into action , quantum of flattery and blind support to bosses will stop and people will make efforts to say yes only when the proposal is justified and without any bias and prejudice. People will dare raise their voice against injustice of their bosses. Whistle blower will be able to puncture the possible mischievous plan of corrupt officers and ministers without any fear of repercussion on his career.

If at all it is found that employees do not perform only because he or she is sure of seniority based promotion, government and every department may frame a suitable policy to punish suitably to non performers and remove them if their non performance persist for a longer period. Such punitive action of course should take place based on written record and adjudged by a team of at least five good officers. Of course there are some disadvantages in seniority based promotions but these disadvantages become insignificant when we ascertain the impact of practice of whimsical and arbitrary promotion of bad officers at the cost of good officers and when we assess the impact of system of flattery and bribery on work culture.

Stagnation and Promotion


I like to draw the attention of a person or a group of persons who is legal expert or who has an expertise on Right to Information Act or filing of Public Interest litigations or who is well experienced in dealing with court cases related to servicemen on following points and expect some solution in the interest of service men community. I like to draw the attention of even politicians who has strong will to change the prevailing bad culture and corrupt practices in administrative, political and judicial system in the country.

When a bank or any government office is unable to promote an employee due to shortage of vacancies in upper cadre , bank should not stagnate the employee only because he has reached the last stage of his scale .This is a fundamental question concerning all employees who are not getting annual increment only because he could not get promotion in time due to management’s fault or due to corrupt interview panel who promote an employee not on the basis of performance but on the basis of gift or money he receives from the employee. It is ironical that in government offices, departments, insurance companies and banks seniors are getting lesser increment whereas in private sectors seniors are worshipped like owners, promoters and savers of the firm. This is why private sector flourishes in real worth whereas public sector officers are facing continuous erosion in value.

In this age of flattery there is no respect for policy or performance. An officer is promoted only when he or she has a God father in upper echelon or he has pleased his boss with huge gifts in cash or in kind or bought and motivated the top executive who is a member of Interview panel. HRD policies in bank promote chamcha culture, RBI and Ministry of Finance or Banking Division all irrigates and promotes such culture. The more one is corrupt, the more he is flatterer and the higher is he posted. This is why cancer of corruption is growing unabated and even vulnerable department like defense is sick of this disease.

There are many EDs and CMDs of banks and government departments whose history is full of instances of indulging in corruption. If CBI conducts an honest inquiry in the credit decision taken by top executives, loan waived by them, and present status of loan sanctioned by them directly or indirectly trough his team of chamchas, bad advances hidden by them, personal assets accumulated by them, I think eight out of ten top executives will be found suitable for severe punishment and not fit for even junior posts.

Unfortunately in our country even authorities entrusted with duty of unearthing corrupt practices and bringing corrupt persons to justice are themselves indulged in corruption to a great extent. Then who will bell the cat is a million dollar question. So called clean and honest PM like Manmohan Singh expresses his helplessness on the front of corruption, naxalism and terrorism very wisely and boldly.

It is due to such wrong policies perpetuated by corrupt and greedy executives that even an officer like Madhuri Gupta could hold an important, sensitive and vulnerable post for more tan 30 years, get whimsical posting and promotions for such a long period inspite of the fact that she indulged in anti-national activities and worked as an agent of Pakistan silently.

Mrs. Rabri Devi, wife of Lalu Yadav could became Chief Minister of Bihar not because she was an able administrator, experienced politician or a knowledgeable lady , but because flatters of Lalu Yadav had vested interest to support her.

Similarly Mr. Lalu Yadav could get the post of Railway Minister despite his involvement in thousand crore Chara Ghotala because ruling government led by UPA and Congress party wanted to survive with his support.

Mr. Ratore could get promotions after promotions and best posting despite Ruchika’s case because of his god liasoning with his bosses and because he could shut the mouth and eyes of his bosses by keeping them happy through gifts in cash and kind.

Raju in Satyam computers could perpetuate fraud in thousands of crores of rupees for years together and win even the award of best corporate governance because he was surrounded by his greedy flatterers, greedy team of Chartered Accountants and corrupt ministers.

Madhu Koda Ex Chief Minister of Jharkhand and Reddy brothers in Andhra Pradesh could commit fraud with the government treasury in billion of rupees because he or they got the support of flatter team of IAS, IPS and other monitoring officers.Mayawati, Mulayam, Lalu like CM reshuffle senior officers like playing cards .Only a team of officers who are yes-men ,flatterer and ready to support and executive all ill motivated work ordered by ministers of the government can only survive and flourish in his or her career. This is the fate of good officers in all banks. There are several Raju in all banks who makes the balance sheet shining and who manage Chartered Accountants at various levels, officers working in Banking division, ministry of finance , top bureaucrats , top politicians all over the country.

In brief in our country even a donkey is posted on top post he can survive and get continuous elevation in career provided he or she has enough acumen to earn bribe and share with is bosses.

It is also a bitter truth all frauds continues and continues until shareholders of the fraud are divided. Frauds are seldom unearthed by CA. CBI or any investigating agency, not to speak of nip in the bud.

As such my second point to attract your attention is that in my opinion there should not be any scope of Interview for existing employee for giving him promotion because quality of his services have already been tested and attested by management for a decade or two or even three.

Even 25 marks allotted for Interview in any departmental promotion processes are enough to make or mar the career of an officer in a bank or any government office. It is a bitter truth of our country that a corrupt officer get 25 out of 25 in interview process whereas a performer get hardly 10 out of 25 which results in diluting the effect of performance of an employee or good marks obtained by him in his appraisals. The great Supreme Court has even advised transparency in appraisal system, but banks management seldom respect even court advises if it hurts the personal interest of its executives. The more power is delegated in bosses the more chances of misutilisation of power and perpetuation of corrupt practices exists and increases in the system.

This is happening in not only in banks but also in all other government departments and this is why, whenever a new Chief Minister takes charge of a state, several IAS and IPS officers are transferred from one place to another as per whims and fancies of the ministers in the new government. Majority of decisions on postings, promotions and transfers are taken on the basis of earning capacity of the officer who can share his illegal earnings with the minister or support the minister in carrying out his illegal tasks for the benefit of his kith and kin or his party men.

In conclusion there should not be any stagnation in any scale of any cadre of any officer of any department or office or bank and there should be no Interview for existing employees to be promoted.

In my opinion whimsical posting, arbitrary promotions and abrupt but ill motivated transfers are the root causes of all corrupt practices prevailing in the Indian administrative, judiciary and political system. It is the power delegated to persons sitting at post empowered to take whimsical decisions which irrigates ,cultivates and promotes the culture of flattery and demotivates the person who actually work and believe in honest performance.

It is unfortunate that no remedy can be obtained even from courts even after lapse of a decade or two .This is the reason that management of a bank or any office or any organ of the government at state or national level indulge in selling promotions and postings and in turn contributes directly or indirectly, willingly or unwillingly, in increasing the level of corruption.

I therefore request advocates to file PIL or any suitable court case which can immediately stop unhealthy practices. To begin with, one can start with stopping the ongoing promotion processes in a bank. I hope experts will take the initiative and oblige serving employees of the country.


Why There Is A Need for Re-visiting Promotion Process ?

Bank has misinterpreted court proceeding, out of court settlement and filing of compromise paper and once again initiated the disputed promotion process which has been frequently stayed and frequently stay vacated. After all why bank is so much in hurry to conduct promotion process which has disputed conditions applicable for various scale officers differently and which are discriminatory.

A petition was filed in Chennai High Court by an aggrieved officer through his union leaders (not majority union) challenging various conditions imposed in promotion policy framed under dictates of Ministry of Finance. When bank management found trapped in its own corrupt game, it called flatterer leaders of majority trade union of officers and also leader associated with above court case and persuaded and forced them applying their managerial tactics to arrive at an compromise settlement to dilute the effect and repercussion of aforesaid court case.

Accordingly a petition for out of court settlement was drafted and signed by petitioner and defendant and filed in Chennai court to abort the court proceedings which is as good as miscarriage of justice before its delivery.

I simply ask a question, If a murderer kills a person and when the aggrieved family files a case in court of law, the murderer forces or persuades or blackmail the family to sign a out of court settlement to puncture the proceeding s of court, to abort the court proceedings and finally to force miscarriage of justice before its delivery, will court act upon such out of court settlement and deliver judgment as per wishes of murderer and give relief to the murdererer?

If such out of court settlement is arrived between the culprit and the victim, between the exploiter bank management and the exploited employee and between the petitioner and the defendant particularly when the outcome of the court case may affect the future of hundreds of other officers in a similar way,---

May such out of court settlement filed in court and at police stations clears the path for exoneration of the culprit and the evil doers?

Are such settlement meant to abort the justice meant for officer community as a whole and not for any individual though case was filed by an individual?

Can a developed and educated society allow perpetuation of reign of injustice with other similarly aggrieved officers only because they have not filed case in court of law?

In the case filed by bank in Chennai court the petitioner also signed an out of court settlement with bank management where one post will be reserved for the petitioner and bank will conduct written test for all other officers desirous of promotion from scale III to scale IV . By such illegal agreement and then by taking the concurrence of flatterer majority trade union officials , bank management once again initiated the promotion process which was stayed by the court.

It is learnt from reliable sources that Court has not yet decided in the matter. Still in the name of court order promotion process has once again been started by the bank without removing all discriminatory clauses and without giving adequate justice to other officers.Truth is yet to be validated .

Officers from scale I to II and from scale II to III have two options one with fast tract and another with normal track. Officers from scale III to scale IV will now have to pass through Computer skill test, written test, Group discussion and interview. Scale IV to V with group discussion and Interview. And finally officers interested promotion from scale V to VI and VI to VII have to pass through only through Interview only.

How it is acceptable that officers in scale I to scale III getting 60 marks will be given chance to appear in promotion process and scale IV and above will not be given same privilege?

How it is necessary to pass computer skill test for scale III officers before participating in promotion process and not necessary for other scale officers?

In all the promotions however unwarranted, questionable and avoidable importance is attached to marks on Annual Appraisal Reports and that in Interview. Marks in APR are given to an officer by different appraiser in different way with biased mind. If the appraiser is whimsical, selfish, corrupt and greedy, he or she can spoil the career of an honest performing officer by giving extremely poor marks even though the concerned officer is sincere and hard working. On the other hand such unsuitable appraise give highest marks to a non performing officer who earn bribe through unfair means and share with the higher officials.

In India where 90% of senior officials are corrupt and caste biased, an officer cannot dream of justice and cannot imagine of appropriate, suitable marks in APAR as per his or her performance, efficiency and potential to perform.

Is it justified to rely upon such marks which are not at all linked with real performance?

Similarly interview is conducted by various Interview Panels constituted by managing committee and these interview panels carry out interview of officers at different centers and give marking as per their whims and fancies. Different panels have different style of marking.

God knows what features of officers are tested in 2 minutes of interview which could not be tested in 5 to 35 years of service through APAR, written test and group discussions. I smell only bad intention in entire promotion process.

After all what is harm if all officers in order of seniority are promoted and given a chance to perform. After all Human Resource Department of each bank management have written history of all officers and they know ins and out of all officers and they know which officer is good and which is bad in real banking. Bank management at central level knows the marks of all officer in all scales on all fixed parameters like educational qualification, job responsibility and that on APAR Officers.

Hence they may prepare a merit list at central level of all officers aggregating all such undisputable marks and based on this they can promote an officer or reject an officers if his marks is less than a cut off marks or they may prepare a list of officer in order of marks equivalent to number of vacancies in particular scale. In this way the system will be transparent and well recorded and there will be lesser scope for manipulation.

At least senior officers who have devotedly worked in bank for two or three decades will not be rejected by interview panel to give chance to a young officer of their choice compromising merit and potential of the officer. It is worthwhile to mention here that marks given by interview panel in 2 minutes of interview cannot be challenged in any court of law and one cannot prove that he has been poor marks willfully and unjudiciously.

Officers who are getting poor marks in APAR, job responsibility and educational qualification will automatically appear in the bottom part of merit list thus prepared. In this way management of bank will get rid of untalented and non performing officers in the most judicious way.IN this way reign of injustice will end as soon as system of interview is discarded from promotion process. I find APAR also unsuitable but at least better than whimsical and unchallengeable marking given by Interview panel.

It is however not acceptable to corrupt executives of higher management. This is why they forced and or persuaded petitioner and took the concurrence of majority trade unions to arrive at an out of court settlement. They agreed to compromise with merit and allowed officers to participate in promotion process even though he got 60 marks only in APAR. In this way bank management in the name of merit strangulated the life of meritorious officers. They know very well that their team of officers constituting interview panel has invested with ample power to reject any officer in interview by giving him 5 out of 25 in Interview and select any officer by giving whimsically 25 out of 25 marks in interview to choose officers of their choice. In this way they have big scope to nullify the impact of higher marks obtained by a senior officer in Job responsibility or APAR parameter.

If a Special Investigating Team is set up to investigate the fraudulent game being played by bank management in promotion process and if they look into APAR marking of last ten years of top 100 executives and compare the same with the marks given to such officers by interview panel, the bitter truth of fraud will precipitate and then only real exposure of promotion process will emerge.

If SIT thus constituted honestly looks into past record of at least 100 top executives, I am very much confident truth will come out.

Following startling truth may come out in the open

· Officers who were indulged in bribe led lending got higher marks by appraiser than who devotedly performed in the interest of bank.
· Officers who were served charge sheet for various irregularities got higher marks in APAR and officers who fought for safe lending given poor marks in APAR.
· Officers who were indulged in WWW got higher marks than officers who believed in work and work only.
· Officer whose bribe lending led to rise in Non Performing Assets (NPA) were given better marks in interview.
· Officers who were given poor marks in APAR got higher marks in Interview and officers who were given best marking by their appraiser on account of their best performance were give very poor marks in interview.
· Officers APAR marks emanating from field level were ignored and fabricated marks were allotted to an officer to promote or reject him.
· And so on,

Many startling facts will come out and then only government will realize the real reason behind abnormal rise in bad assets in all public sector bank as also the real reason behind growing frustration among officers, growing indifference and unwillingness among senior officers towards promotion process and reason for young and inexperienced officers given the responsibility of running a branch jeopardizing the interest of the bank.

SIT will also tell the truth of court cases. It will come out how court cases in last two three decades were closed and justice was aborted by forcing petitioners to enter into out of court settlement.

Last but not the least, bank management in the name of merit is giving promotion to young and inexperienced officers and thus giving higher responsibility to incompetent persons and jeopardizing the quality of bank assets, profitability of the bank, the quality of customer service and the interest of investors.

It is true that by giving quick promotions to young officer bank management divide the unity of officers and puncture the trade union movement against reign of injustice and ensure there is no IR problems. But in the long run it is not only Human resource of the bank who suffer in wage revision caused by poor performance of the bank but it also tarnishes the image of the bank in investors and shakes the confidence of genuine customers of the bank whose future depends on financial support of bank.

When Human Resource in any organization is not devoted and motivated, bad customers will get the opportunity to pay bribe and get sanction of credit facility for their business and thus contribute in increasing the volume of bad assets. It is undoubtedly true but unfortunate that during last two decades HRD of all banks have faced severe erosion in quality and they HRD have completely failed to give justice to their work force and to the bank they serve.

Latest Supreme Court Judgement On Reservation In Promotion Process in banks also speak a lot about need of real merit to have healthy growth and to ensure justice with merit.

After a year long hearing, Supreme Court has realised its error in its own judgement given last year in connection with need of quota for SC ST in promotion processes. It is true that our country has many such families who are socially backward, economically weak and a discarded force. Our Constitution has therefore provided some reservation for them so that they may get entry into all schools and colleges , government offices, banks and other public sector undertakings.  There is no second opinion on fact that our country need quota system in job and educational institute to bring these socially backward person in mainstream of society.

But last year , Supreme Court gave a erroneous judgement when it delivered an order that banks have to provide reservation in promotion processes upto scale VI. As a matter of fact the judgement was not clear as it should be. To allay all doubts and confusion , some banks approached Supreme court for review of its order and it gives me great pleasure that at last Supreme Court also has realised its error which took place in its last year order and hence thought it wise to give a fresh order  in modification of the old order of the same court.

Now it is made crystal clear that there will be no reservation in public sector banks in promotion of officers from one scale to other. It is the duty of bank management now to properly train officers of  backward caste officers and develop their skill so that they may be promoted to higher scales also . Court has admitted indirectly that Government departments or any PSU or any bank cannot be allowed to give disrespect to merit  and cause loss to public money.

In fact all Officers may be and should be given an opportunity to get promoted in order of their seniority in joining in a particular scale of officers. Every officer who is recruited has potential to perform provided he or she is properly groomed and taught properly from the day of joining. If   some of them do not perform well or commit mistakes even after all training and motivation,  he or she may be punished , his increment may be curtailed or he maybe posted at a suitable place . If all officers are promoted in serial and chronological order, question of quota will not arise. On the other hand officers who perform better may be financially awarded .

In most of public sector banks, there has been  a merit oriented promotion policy for last three decades . Still several inefficient and corrupt officers are getting promotion whereas several best performers are rejected . This is because of  the fact that Interview is not only an integral part but most effective part of Promotion process .

Interview process is such a process where lobbying with higher officials or bribe or recommendation of some VIP plays greater role and where performance of an officer appearing for promotion become useless and valueless. This is because , in an interview ,fate of an officer depends not on his performance , not on his knowledge, not on his experience  but on his ability to buy a member of Interview panel or create pressure on a member of  Interview panel constituted for picking up officers for elevation.

Another bitter truth of so called merit oriented promotion policy used by public sector banks for last three decades for promoting an officer from higher scale is that though officer is promoted to higher scale or post under influence of bribe, flattery or recommendation of VIP , they are not fount fit for post created for promoted officers.

This is why though officers are promoted to scale IV or scale V , but majority of such promoted officers are still doing work which even a scale I or scale II or scale III officer can perform. Similarly officer may become scale VI or scale VII , he is found incompetent by the same management even for the post of scale IV or scale V. All are accommodated suitably  at junior level post because influence of VIP is effective at all levels.

When this can happen under the umbrella of so called merit oriented promotion policy, why not the same type of accommodation may be provided when an officer is promoted to higher scale by dint of his seniority but not found fit for the post meant for promoted scale. 

I like to put stress on seniority oriented promotion process only because I know by way of my long experience that there is no guarantee that the authority empowered to promote an officer will act without error of omission or commission. It is a undeniable truth , that majority of such authority are influenced by bribe, flattery, caste similarity , pressure of VIP politicians or pressure of some higher bosses .

All these unethical activities happen in such a way which leave no proof behind and hence cannot be challenged in any court. And the most cruel, intolerable and condemnable truth of Indian judiciary is that even cases filed in courts are not decided in decades . Justice delayed is justice denied. All corrupt activities occurring   in this country or anywhere in the world take place usually  by verbal orders , telephonic advices or decided in  hidden place.

This is why malpractices continue almost in all banks without any challenge from any corner or from any aggrieved officer. Even if  any aggrieved officer file a case , he is pressurised to withdraw it or decision is delayed in court for decades by paying crores of rupees from banks treasury to teach a lesson to officer who dared file a case against reign of injustice.

It is open secret in banking , that whenever promotion process begins, lobbying starts at all levels. Officers seeking promotion either offers costly gifts, or offer suitable bribe or applies the influence of some powerful persons. They discover the name of officers who will be interview panel. And when interview panel starts conducting interview, each panel members will have a pre-decided list of officers  to be promoted in their brain . Process of interview is simply a formality and complete wastage of money in payment of travelling bills raised by officers appearing for promotion and panel officers authorised to carry out interview process.

It is important to mention here that upto 1980 , seniority based promotions used to take place in each pubic bank. But top officials of the then top management used to make excuses to conceal their inefficiency or their corruption that they do not have good officers and hence there is no growth as expected by government. As a result , government of India gave them full freedom on recruitment, promotion and transfer. Banks were given freedom to recruit meritorious officer even from educational campuses as  private  sector companies use to do. Campus recruitment stayed by Supreme Court only two years ago. Banks were free to promote and transfer any  officers as per their whims and fancies to protect , to increase profitability and to increase growth rate of their banks.

It is undeniable truth that majority of powerful persons in our country misuse their powers for benefit of self , their families, their friends and their flatterers. Powers are in general used to earn illegal money , to get higher and higher promotions and to get choice transfers. It is known to all , officers who hold powerful post force their subordinates either to support them in unethical and illegal acts or face frequent and torturous transfers.

An officer who support in corruption to higher bosses and act as per whims and fancies of higher bosses get all benefits and all comforts whereas who do not dance as puppet are subjected to critical and remote transfers so that his family is fully disturbed. This fear of transfer and loss to family has made many officers indifferent and dormant. They do not even opt for promotion. As a result of this bad culture, it is always the bank which suffer. This will not be an exaggeration to say that entire government machinery in victim of this evil culture.

This is why , even after lapse of more than three decades, position of health of these public banks have not improved, rather it has deteriorated year after year. And if all hidden bad debts are exposed, each bank will appear as  bankrupt and each of them seek huge capital to comply Basle norms stipulated by RBI. Thousands of crores of rupees are introduced by Government to provide support to sinking banks. When banks grow weakness, government merge it with some other strong bank. But right medicine to cure to disease is never prescribed , neither by RBI nor by Ministry of Finance. Because all these ministers and RBI officials act on false certificates of good health and they plan their strategy based on manipulated data and figures only.

Lastly it is public who has to suffer, they are paid lesser interest on their deposits, they are charged higher commission, they are charged higher interest on loans they take, they are paid less dividend on shares they buy and so on . Even bank staff do not get adequate wage hike because to less paying capacity. Health of banks has not improved from any angle of consideration. Even RBI has now admitted that as much as 12 percent of total assets of banks are stressed and much more is hidden.

In most of banks , real performers do not opt for promotion to avoid humiliation they face when they fail despite good performance. Now top officials of bank management blame that they do not have experienced, talented  and senior officers, they say that majority of  officers are going to retire in coming few years, they say that there is global recession and so on.   They will never admit that they committed mistakes on many front, they will not agree that they promoted corrupt culture in banks and they will not admit that they did not perform honestly to safeguard banks. They will never admit the fact that promoting  corrupt officers ignoring  genuine and meritorious performers demotivated good workers and promoted bad culture in bank which resulted in unabated rise in bad and stressed assets .

In this way it becomes clear that both the processes, seniority oriented promotion processes and merit oriented promotion processes are their own shortcomings and deficiencies and loopholes. One cannot stop the culture of  a worker to give favour to persons of his choice, his caste, his friends, his relatives and so on. After all it is a matter of perception , whether it is a case of recruitment or promotion or it is a case of sanctioning a loan to loan seeker. If an officer is corrupt, he will say a good proposal as bad until he gets bribe in return of sanctioning the loan. On the contrary corrupt officer may sanction bad proposal if he is paid adequate bribe directly or indirectly in lieu of his generosity . Similarly a member of Interview panel will give 25 out of 25 to an officer who has obliged him and may give 1 or 2 out of 25 to an officer who is performer but not flatterer or bribe giver.

I therefore find it is safe to introduce seniority based promotion which will avoid all cases of discrimination and misuse of power by higher bosses. It will dilute the demand of reservation in promotion process. Justice will prevail in all matters and there will be no demotivation and frustration because all will be promoted in order of their seniority. However to give incentives to best performers, various types of financial incentives may be given in a transparent manner.

Bank management may create an atmosphere where officer will be tempted to work more and more and will have no fear in exposing corrupt officials and denying sanction of loan to bad persons.

Some of senior officers advocate system of written test , computer skill test or debate to promote an officer from one cadre to other. I have no hesitation in saying that there is no need of written test also. Because it is also managed. Thieves are more in number and they are placed at all powerful post. They can manage balance sheet ,they can manage technology, they can manage software ,they may also manage your answer sheet and question paper too. Even IBPS ( Body created for conducting written test and interview for recruitment and if needed for promotional test too) is manned by same corrupt officers who had inculcated bad culture in banks.

These corrupt officers may leak questions or sell question to candidates as happening in almost all other examinations. Moreover an officer who is master is reading and unwilled to do an work can also pass written test. I have found many officers who spend major time in working hours in reading circulars and books when examination system is near. These officers least bother of what is needed for real growth in bank and what is needed for extending best customer service.

An officer may be highly skilled but may not be willed to perform. It is better to train willed officer to develop their skill. Banks progress by willed officer not by only purely skilled officer. Skilled and higher educated officers may be used for training unskilled workers. Banks need officer who can take decision based on practice and based on need of the customer keeping laws in mind. Bank need officer who can understand a project for which a business men seek loan, An officer who can read the character and integrity of a loan seeker can save banks from loss.  

But a person who knows only laws but unable to execute them fruitfully is of no use. Such highly talented officer may use their talent to earn more and more bribe and cause creation and accumulation of stressed assets in bank. And this has happened in almost all banks. Talented persons have more looted banks and caused more damage to bank than unskilled and less talented boys and girls. This is bitter truth of banking. An officer who is skilled in delivering lecture and who is master is creating human relations is made  Regional Head or Zonal Head ED or CMD or bank even if he or she is not well conversant with banking activities.

Similarly process of carrying out Computer skill test for promoting an officer in scale III to scale IV and officer in scale IV to V appears to be farce. Primarily such skill test are conducted in very casual manner and almost all are cleared through this test. Same is the position of debate carried out among 10 to 15 candidates to pick better officers. An easy topic is chosen and lastly officers who are in the mind of invigilators are only picked up. FAte of such debates remains the same as is the case of Interview. In both these tests, whims of examiner is more effective, his perception is more effective and his liking is more important . It is seen that an officer is considered best in on interview is considered worst in another interview . Because fate of these tests depend largely on the nature, character and prejudices of officer conducting such tests.

Keeping in view , I am of strong opinion that process of written test in case of fresh recruitment is necessary but these test for promoting an officer is totally unwarranted and avoidable. Once an officer joins a bank, it is the duty of management to make a semi -skilled or less skilled officer fully skilled and motivate an unwilled officer to perform as per need of the bank. And the most important is that all officer and all human being are of not same quality of potential. An officer may be expert in operational work, another may be expert on computer work, some of them  may be in expert in loan processing work , some of them  may be specialised in agricultural or foreign transactions, some of them may be inclined to do marketing work and some may be inclined to do the work of managing others, managing recovery of loans , managing business growth and so on. Management of banks have to use manpower as per his or her potential .

Position of  public sector Banks has deteriorated during last few years because of facts that top officials have assigned duty to officers as per their whims and fancies. Marketing officers are posted as loan processing officer, cash officers are sent for marketing , recovery officers are given the duty of desk management and so on. An officer who is expert in bringing business for bank are assigned the duty of selling insurance product. Even security guards  who are totally unaware of banking work are promoted to the post of clerk. Lady officer who have difficulty in field work are given the work of field. Under such conflicting positions, any human being cannot perform as per his or her potential. Rather they will always feel frustrated, depressed and annoyed with top bosses. How can they perform honestly and as per their potential?

I have expressed my opinion as above after the latest verdict of Supreme court on issue of reservation for SC/ST in promotion processes, because I know very well that as soon as this message is spread to all branches, strong lobby of officers who aspire for reservation may become active and violent. They may seek support of many politicians too. On the other hand when  performing good officers are rejected in promotion process to accommodate even comparatively less competent officers of reserve community , strong lobby of officers of non-reserved category become active . One after other litigation will start and organisation will continue to suffer.

This is why I advocate seniority based promotion policy which is less controversial , though it has also  some shortcomings . But it is always better than so called merit oriented policy which is in force for last three decades and more.

Mr. Narendra Modi Prime Minister of India has wisely and rightly  finished interview system for call C And D staff for recruitment. But the fact is that the corrupt culture has gripped all recruitment and specifically promotional processes. Need of the hour is to end interview system in all promotions.  Let it be fully in order of seniority. There will be minimum scope for manipulating results.

Very soon Mr. Modi and all concerned officials will realise that interview is not at all needed for any promotion and interview is the root cause which promotes corrupt culture and which escalates corruption to new heights

Why Assets of  Public Sector Banks are moving from bad to worse when there has been a merit oriented promotion policy existing in all PSBs for last three decades and more?

State Bank of India chairperson Arundhati Bhattacharya said banks were apprehensive about the Reserve Bank of India's deadline of March 2017 for them to clean up their balance sheets as the move may affect lenders' bottomline. The Reserve Bank of India (RBI) has asked banks to increase provisions to cover visibly stressed assets in the second half of this fiscal year. This directive issued by RBI if honestly put in action may cause bad loans and provisions to bloat.

Now it has become crystal clear to all that management of every public sector bank are to suffer more pain and face erosion in profit and even incur loss if RBI Governor Mr Rajan remain rigid on his stand that all banks should clean their balance sheets latest by March 2017 and should increase provisions on stressed assets identified by RBI latest by March 2016. This has become more evident when SBI Chairman expressed apprehension of sharp rise in NPA and fall in profit.

Now there is no doubt that Chiefs of all banks including so called strong bank like SBI had resorted to hiding of bad debts using illegal and unethical ways and tools in all preceding financial years to inflate profit ,to earn unjustified  incentive and to get quicker promotion.
They all are guilty of window dressing. In the past they all were caught committing fraud in making inadequate or no provisions for staff terminal benefits payable to them on retirement.

Inspite of all warnings issued by RBI and Ministry of finance not o inflate business and profit of bank by window dressing, Chiefs of every bank ignored and disobeyed such warning ,and they have been doing so year after year. Who will punish such high profile fraud masters?

As a matter of fact ,branch heads of almost all branches of all banks are resorting to window dressing and to conceal stressed assets by using wrong and improper ways. This culture of playing foul game is very old and promoted and irrigated by all top officials . Junior officers have to dance as per direction given to them by their seniors. RBI and GOI have been silent spectator of all such game of manipulation for decades.

I may say that without manipulation , PSB cannot earn profit because the culture of lending is erroneous, culture of promotion in PSB is flattery and bribery based and because politicians use PSB to enhance their vote bank. Unless and until there is change in DNA of bankers and politicians, there is no guarantee that creation of bad assets will stop rising. Bankers will continue to blame economic slowdown or global recession and  continue to cause loss to their bank in greed of getting self interest served and on the contrary private banks will continue to boost up their profit and business quarter after quarter.

Shares of banks with exposure to large corporates have come under selling pressure in recent weeks with those in the public sector bearing the brunt. The stock market value of one private bank HDFC Bank is now almost the same as that of State Bank of India and all the 20 nationalized banks put together. These 21 banks control over 70% of bank lending in the country whereas HDFC Bank, the country's second largest private lender, accounts for 6%. This proves that investors do not have trust on functioning and financial figures of public sector banks and they do not have trust on quality of assets of PSU banks and SBI . They know it very well that these banks are hiding bad assets in their books to reduce burden of provisioning and to inflate profit.
It is however a matter of pleasure that RBI Governor Mr. R Rajan has taken some step to clean balance sheet of public banks and State bank of India . It is true that if all banks honestly declare all bad asses as bad, there will be voluminous jump in value of bad assets . As on September 2015, Gross NPA of banks have crossed 6% of total assets and that of stressed assets have crossed 14% . But if all hidden stressed assets are exposed honestly, Gross NPA will rise to more than 25 % .

It is another matter of pleasure that RBI official and the government has assured it will provide public sector banks all the capital they need to grow their business and the central bank will release regulatory capital if required.

Let us see how far bankers act honestly and how far RBI officials and government officials are able to punish bank officials who still indulge in window dressing to hide NPA and those who perpetuate culture of treating bad assets as standard assets.

Now when health of public banks has become highly critical due to some reason or the other , one of trade unions called AIBOC has written to Ministry of Finance to prove that bank staff are not responsible for current mess in these bank. Prior to that AIBEA has also written several times to RBI and MOF to take care of rising trend in bad debts in public banks.
Joint General Secretary of the AIBOC (Apex), and Rajiv Sirhindi, Secretary of Punjab Unit of the AIBOC, said major trade unions of the country had sent a letter to Raghuram Rajan, Governor, Reserve Bank of India, putting the facts straight and seeking the direct intervention and action by the regulator. If the RBI all of a sudden wants to set right everything overnight, it would be certainly at a great risk of destabilising the banking system in general and PSBs in particular.

But in my view writing letters is not going to serve the purpose they want to serve. They have to furnish facts and figures before appropriate authorities to make their position crystal clear. AIBOC try to appear as concerned for growing bad debts and trying to shed Crocodile Tears.

AIBOC has expressed in their letter addressed to MOF that majority of public sector and few private sector banks would be in red on account of asset quality review by the bank. It proves that leaders of trade union also know it very well that game of hiding stressed assets in banks is not uncommon.

Every officers who heads a branch or a Region or a Zone or a bank is habituated and trained to show bad assets as Standard and if any officer do not obey verbal orders coming from higher offices , he or she is taken to task , either by transfer to critical place or by rejection in promotion or by giving him useless work. This culture is well established and deep rooted. Window dressing is inseparable part of bank management .

Fact is that Trade Union Leaders in general ( barring some exceptional devoted leaders ) too are playing the same game as top officials of bank management are playing with the future of bank staff. And both of them want to serve mostly their self interest than the interest of their members or bank staff . Both of them want to pass the days happily sacrificing the interest of staff as well as that of the organisation they belong to. Some of them have retired , still they continue to lead trade unions . This is because young boys and girls or working senior bank staff do not come forward to take the lead.

I do not hesitate in saying that so far as corruption in bank is concerned or that of accumulation of bad debts in concerned , bank management and trade unions are more or less two sides of same coin. Had trade unions been honest and straight forward and had they been real protector of bank staff and bank , these banks could have remained in better position.

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