UPSC Prelims 2019 GS Paper I · Q73 of 100 Economy easy

The Chairmen of public sector banks are selected by the

  1. (a) Banks Board Bureau ✓ UPSC's answer
  2. (b) Reserve Bank of India
  3. (c) Union Ministry of Finance
  4. (d) Management of concerned bank

Why the answer is (a)

• The Banks Board Bureau (2016), set up on the P.J. Nayak committee's recommendation, selected and recommended candidates for Managing Directors, CEOs and whole-time directors of public sector banks and also advised on governance — option (a) per the official key.

• The Government appoints on its recommendation; in 2022 the BBB was replaced by the Financial Services Institutions Bureau (FSIB).

• The RBI (b) approves private-bank CEOs; the Finance Ministry (c) issues the appointment but does not select; bank managements (d) have no role in choosing their own heads.

• Hence option (a).

Why the other options are wrong

(b) Reserve Bank of India
The RBI approves private-bank CEOs, not PSB chairmen.
(c) Union Ministry of Finance
The Ministry appoints on BBB's recommendation but does not select.
(d) Management of concerned bank
Bank management does not choose its own chairman.

Asked in the GS Paper I of the UPSC Civil Services Preliminary Examination 2019, held on 2 June 2019. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.

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