Candidates aiming for top job in PSU banks will have to undergo psychometric tests to ascertain suitability

NEW DELHI: Aspirants to the top job in public sector banks (PSBs) will have to undergo two psychometric tests aimed at ascertaining their suitability for heading the lenders reeling under bad loans. The tests are part of a rigorous three-stage selection process which includes background check and personal interviews, executives familiar with the matter said.

There are about 50 candidates in the fray. The Reserve Bank of India has engaged global management consulting firm Hay Group to shortlist managing director and CEOs for five PSBs including Punjab National Bank and Bank of Baroda, two senior executives said.

"The psychometric tests are to analyse the leadership qualities, situational judgment capability and overall personality traits," said one of the executives, who did not wish to be identified.

Hay Group refused to comment, as did RBI. The psychometric test lasts around four hours and includes questions such as the biggest setback in the candidate’s life and how he or she dealt with it, the executive said.

"A group of five-six experts asks these questions, some are in-depth questions, the rest seek to ascertain the preference and style of an individual – whether you are impatient, risk averse and so on," said one of the candidates who attended the session. Another executive said that the idea is to have an objective third-party view before the candidates are tested on their sector -specific knowledge.

"I think this was the first time I listed my achievements and spoke about it for almost an hour," the candidate said. Earlier this year, the government had approved new norms for selection of MD & CEO for five PSBs, paving the way for appointment of private sector candidates on flexible salary packages. Bank of India, Canara Bank and IDBI Bank are the other lenders in the list.

In April, the government relaxed eligibility criteria with regard to age and experience of applicants. While the age limit has been increased to 57 years, from 55 years earlier, the mandatory board-level experience for the applicants has been reduced to one year, from three years.

The three-stage appointment process will start with screening and shortlisting of candidates based on the experience and eligibility conditions. "Candidates duly recommended by the screening agency will be called for the interview," the ministry had said in its notification, adding that candidates will be eligible to apply for the vacancy in one or all five banks.

In 2014, a committee was set up to examine the selection process to the posts of CMDs and executive directors of PSBs for 2014-15. This was after the then Syndicate Bank chairman and managing director SK Jain was arrested by the Central Bureau of Investigation for allegedly accepting bribes of Rs 50 lakh to enhance the credit limit of some companies.

The government then cancelled the appointments of eight CMDs and 14 executive directors of staterun banks made by the previous UPA government. This was followed by management reforms of PSBs and it was decided to split the post of chairman and managing director-cum-CEO.

The government then appointed MD & CEOs of United Bank, Oriental Bank of Commerce, Vijaya Bank and Indian Overseas Bank.