"Lateral movement, which can provide better career growth prospects to middle level management, is now under active consideration of the finance ministry," an informed source told PTI in New Delhi.
Though the present rules allow executive directors and general managers of a bank to move on to a higher post in another bank, it does not allow general managers or deputy general managers to migrate to another bank in the same capacity.
As a result, some of the big banks have become top-heavy with many senior and talented staff retiring as mere GMs or even DGMs while other banks are short of capable senior management staff.
"Ageing senior management is now a major problem with PSU banks. The government is now considering a proposal of allowing PSU banks to hire younger GMs and DGMs of another bank," the source said.
The move will enable banks to fill some of the vacancies, improve their productivity and bring down the average age of management brass in the PSU banks.
Absence of "career growth path" for middle management has been discouraging young graduates of renowned management institutes to join the PSU banks even at attractive salaries.
"B-school graduates shy away from PSU banks but prefer private and foreign banks as they offer better growth prospects and promise higher pay package," a PSU banker said recalling his experience at a renowned management school.
The rigidities in the salary structure also prevent PSU banks to attract talented executives. "We can not offer a professional more than what the chairman gets," a bank CMD said. At present, middle level management in private and foreign banks get more than 2-3 times the salary of a PSU bank chairman.
Comparing the PSU banks and private players, the banker said, "The future growth of PSU banks will depend on recruitment of talented people, proper human resource policy and promotion policy."
At present, these policies are governed by "legacy rules", he said. Bankers fear that lateral movement of middle management may be opposed by the bank unions.
