New service rules for SCBs await finance adviser's approval

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Shakhawat Hossain
The state-owned commercial banks (SCBs) will have new service rules that, among others, will facilitate recruitment of competent persons in key positions at higher wages and evaluation of their performance, according to sources.
The banking policy wing under the finance ministry has already placed the new service rules before the finance and planning adviser Mirza Azizul Islam for his approval.
"It is necessary to have new service rules for the SCBs which have been turned into public limited companies recently," said a finance ministry official.
Sonali, Janata and Agrani were converted into public limited companies early this year under a multilateral donor driven project.
The new service rules aim at increasing performance of the officials of the SCBs, which are losing their business share to the private commercial banks, said a top SCB official.
"The proposed service rules are also meant to bring about changes in the salary structure of the officials of the SCBs," said Agrani Bank chief executive officer Abu Naser Bakhtiar.
"There should be a link between performance and compensation package. One cannot expect better performance from officials and employees offering them low wages," he said.
The chief executive officers of the SCBs are now receiving monthly salary about Tk 0.6 million each. The remuneration is being provided from a World Bank (WB) aided project fund.
The large gap between the compensation packages of CEOs and other senior and mid-level officials of the SCBs has given rise to serious resentment.
"The new service rules will help the banks to address the issue," he said.
Another SCB senior official said the proposed service rules will have review committees to evaluate performance of the officials of the banks.
"The proposed review committees will enjoy more power than the present ones," he said, adding that the service rules will allow the review committee to accomplish their tasks expeditiously.
Bank officials said there is a link between new service rules and the present move by the finance ministry to downsize the workforce of the SCBs in line with the suggestion made earlier by the WB.
The Washington-based multilateral lending agency wanted downsizing of the manpower in the SCBs by about one-third by December next under voluntary separation scheme.
At present around 46,000 people are working in the SCBs.
The WB suggested halving the manpower of Sonali Bank and that of Janata Bank Limited by one-third.
It has, however, suggested recruitment of 1400 more people in the Agrani Bank Limited.
The donor driven bank modernisation project is being implemented since 2004. The ultimate aim of the project is to privatise the SCBs by offloading their shares in the stock market.