The finance ministry is reviewing a proposal to increase the number of Chief General Managers (CGMs) in public sector banks (PSBs) due to their growing business and profitability. Currently, government guidelines allow for one CGM for every four General Managers (GMs) in a PSB, based on rules set in 2019. Since then, the performance of PSBs has improved significantly, even during the pandemic, according to sources.
PSBs have seen substantial growth in their business and have posted record profits. In light of this, the Department of Financial Services, under the Finance Ministry, is considering revising the CGM positions to help PSBs achieve the next level of growth, sources said.
A decision to adjust the guidelines will be made after careful consideration of the banks’ expansion needs. The CGM position was originally created in 2019 following the merger of 10 nationalized banks into four larger entities. CGMs serve as an important layer between General Managers and Executive Directors in the administrative hierarchy.
In addition, PSBs have requested the Finance Ministry to allow their boards to decide on the number of CGM posts based on their individual business requirements. The current staffing ratio of General Manager (GM), Deputy General Manager (DGM), and Assistant General Manager (AGM) is 1:3:9, which was set in 2016, and banks believe it needs to be updated for better operational control.
Currently, there are about 4 lakh officers working across 12 state-owned banks. PSBs’ collective profits reached ₹1.41 lakh crore in the financial year ending March 2024, a 35% increase compared to the previous year’s base of ₹1 trillion. In 2022-23, PSBs earned a net profit of ₹1.04 lakh crore.
State Bank of India (SBI) contributed more than 40% of the total PSB profits in FY24, earning ₹61,077 crore, a 22% rise from the previous year’s ₹50,232 crore. Punjab National Bank recorded the highest percentage growth in net profit, up by 228% to ₹8,245 crore. Union Bank of India followed with a 62% increase to ₹13,649 crore, and Central Bank of India reported a 61% rise to ₹2,549 crore.
