Before the Sixties Indian Banking was not viewed as a lucrative avenue by career seekers. Low scales of salary and unrestricted working conditions marked the lot of employees in banks. In the predominantly agrarian economy, banks were depending on limited seasonal credit needs of commodity traders, as the main source of their lending activity. Agricultural commodities stored, locked and held in banks' possession were the security for the banks financial exposure. Banking skill and knowledge consisted more of business content and less of needing a professional qualification as far as credit delivery techniques were concerned. Under-graduates and matriculates could control not only Bank branches, but hold responsible position even at the head offices of banks.

MYBANK too had many of such under-qualified executives at the Head Office and branches. When I joined MYBANK in 1957 as a clerk at Warangal Branch, I happened to be the only graduate employee amidst the five member team, that managed the business of the branch. Banks were operating with low resources and there was less demand for capital by borrowers. There were only two Banks (other than SBI) to have more than Rs.200 hundred Crores of Deposits, designated as the Big Two (i.e. CBI, and MYBANK). Then came BOI, BOB and UCO. These five were the all India players. All other banks were identified as Regional entities.

Saving deposits fetched 2% interest, the ruling rate for Fixed Deposits was 4% and advances were available from 6 to 7-1/2%. Lending at more than 9% was not heard of. My clerical salary was Rs.120/- per month consolidated and my manager was getting about than Rs.500/-. If one were to learn the primary thumb rules of safety, security, liquidity and profitability, and basics of negotiable instruments act, he can successfully manage a bank.

This scenario changed after the Sixties even before nationalisation of major banks in 1969. Growth of the economy due to rapid industrialization, development in other sectors of activities and expansion of money supply with the public fueled by continuous inflationary trends accelerated the fast development of Indian Banking in terms of branch network, operating profits and working figures. This together with the advent of powerful trade unions in the industry, enabled bankmen to improve their pay pockets, perks and other working conditions. This trend continued and persisted in the following decades. Bank employees came to be viewed as a clan of well-paid, prosperous and happy segment in society. The then Finance Minister, Shri C.Subramaniam, during the period when Emergency was in force in the country could significantly remark that bank employees were "an island of prosperity in a ocean of poverty". The aggregate deposits of the Banking System, which was at mere rupees 5300 crores in 1969, the year of bank nationalization, witnessed steady annual compounded growth at around 15% to 20%. It crossed Five Lakh crores in 1995 and Ten Lakh Crores in 2000 A.D. In 1969 banks with aggregate deposits of Rs.50 Crores and above were considered as large banks and these were nationalized. Today many individual metropolitan branches of Banks have deposits exceeding this limit.

Consequently banking in the country became a lucrative employment avenue in the Seventies and Eighties, for the emerging young graduates and postgraduates from the strata of middle class families of our society. On account of the fast branch expansion and business growth, there were continuous recruitment of new personnel and forward movement of existing serving employees further up the hierarchical ladder through internal promotions. It was common for may employees to secure five to six promotions in their tenure of service at the bank, before retirement.

Banking was traditionally an industry that called for utmost prudence and eternal vigilance in securing the safety of public funds and retaining public confidence. Stability of a bank and its business accretion were based on continued public trust in their soundness and solvency. Bankers looked to the three 'C's of borrowers (character, capacity and capital), while considering their loan applications. A banker or bank employee commanded respect in society. There was no corruption in banks on a significant or debating level, though the threat of frauds was eternally faced by Banks everywhere. Consequently one never heard of charge sheets or employee-dismissals for acts of misconduct or corruption. A charge sheet was considered a serious weapon and was rarely used.

The situation qualitatively changed in the mid eighties and nineties. Old dedicated and experienced top management personnel of the pre-nationalization era withered away due to natural process of superannuation and retirement. The new leadership that inherited the top layers was ill prepared to shoulder the added new burden. It lacked the traditional banking culture of trustworthiness and prudence. Selfish opportunism and adhoc adventuresome characterized the new management. They lacked vision. Personal greed replaced prudent goals for securing the Institution's interests.

Why all this happened? Why misconduct emerged on a vast dimension in the era when new Conduct & Discipline Regulations were codified and formulated and enforced for the Bankmen, while things were smooth and fair earlier when no such regulations were in force? Why banking became inefficient and corrupt when qualified graduates and postgraduates were inducted in the system, while it remained more care taking and competent earlier with high-school passed and under graduates managed the show? Bankers were then vigilant to protect and safeguard their assets, but today it is an irony that bank executives are increasingly coming under the preview of vigilance scrutiny. The custodians of public trust and confidence are increasingly becoming untrustworthy. There is today an urgent need for strictly guarding the guardians of the nationalised banks.

I worked in Warangal Branch of MYBANK in 1960, when the branch committed a sticky advance of only Rs.5000. The 'affair in Warangal' spread every where like wild fire and was the spoken word throughout in the Southern Region of the Bank at that time. At the branch, we were all literally crest fallen and remorse stricken. In those days we were not equipped to know how to study a balance sheet of borrower firms. But we ensured total safety of Bank's assets by regularly collecting what we called 'bazaar reports' about the players in the market and perfecting our system of risk management. Failure was an exception, and when an individual case occurred, it was felt as a dooms-day by the bank manager. It was not professionalism, but pragmatism, sound commonsense, personal integrity and cleanliness that ruled the day. Today bankers are not perturbed if bad advance to an extent of rupees one Crore emerges. No one has time or concern to ponder and correct the rut that is now found commonly everywhere.

The feeling of false security due to government ownership, wrong business objectives, where earning profits was considered as irrelevant and back-stepped in the business priorities, and the effect of political influence exerted on banks' in their day-to-day administration adversely affected the management of nationalized banks. Remote directions for routine business operations of the nationalized banks from the RBI (who decided operational guidelines) and Banking Department (who gave the credit deployment guidelines for priority sector lending) acted to the detriment of the innate initiative, self reliance and efficiency of the senior and middle level management within the banks. They became dumb rubber stamps to blindly ditto whatever instructions were received from the external controllers. Lack of professional training, quick promotions (vertical ascendancy without horizontal movement and without gaining experience in multiple disciplines), and cross-country transfer of staff, without planning a regular career path for them resulted in unplanned deployment of the unprepared human resources leading to imperfect operations.

An officer in the Indian Administrative Service enjoys a definite career path. He is allotted to a State cadre after selection and extensive training in the Lal Bahadur Shastri National Academy of Public Administration. He starts career at a remote village, and gains experience in the revenue services at the village level, moves to the taluk headquarters to acquaint with the functions of the tahsildar and Block Development Officer and then is posted as Asstt.Commissioner in a sub-divisional head quarters (mostly a semi urban center). He passes the confirmation test and the language test of the State to whose cadre he has been allotted and then posted as Dy.commissioner or District Collector. He serves two terms in the Districts. He may still be below 35, the prime age for an active career. His is young, but endowed with knowledge, inspiration and drive. He then moves to the State capital for posting at the Secretariat. Thereafter he is deputed to Government of India. Every officer of the Administrative service in the Government of India belongs to a particular State cadre. They all know well the pulse and feelings of Indian villagers. Majority of our population still lives in villages. And we have administrators sitting faraway, but well qualified and equipped to serve them. The administrators have had ample opportunity to know what the people want and what their problems are. The career path of the administrative service eminently fulfills the job needs to serve the people, and to accept the poor people of India, as their masters.

The recommendations of Pillai Committee for defining a clear career path for officers in the service of Nationalized Banks is not implemented by the Banks. There are senior executives in Head office, Regional or Zonal Offices, who have no branch experience and who had had no interactions with the common constituents of the bank for whom the Banks are to extend service.

Surfeit brings the sad day. In 1985 I wrote to the then Chairman of MYBANK that it was easier to purify the polluted Ganges than the credit administration of the Bank. Business growth continued, even after the mid eighties, as it is persisting even today, but emergence of NPAs in the balance sheets of the Banks crippled their profitability and reduced their capital adequacy. Banks started to be categorized as loss showing banks, weak banks (which now show profits, but has earlier losses accumulated still not wiped completely) and not so weak banks etc. Still the public sector banks enjoyed public confidence and trust on account of State ownership and Government backing. To magnify this benefit, the signboards of every branch of nationalized banks prominently display the phrase, immediately below its name "An undertaking of the Government of India". This contributed as an important "S" (strength) for these banks in their SWOT perception.

The nationalized banks faced no major crisis in the seventies, when the personnel of the old top management, who earlier managed or controlled these banks when they were in the private sector, were still continuing and steering the course of management. But after the eighties when the new generation of those in the junior cadre succeeded to top executive posts and took control of the nationalized banks, things started drifting.

The new generation of top management setup came to occupy positions exclusively on the strength of quick promotions, thanks to rapid expansion and business growth, after putting in few years of service in the middle posts in the hierarchy. In the earlier twenty-five years of their service they secured one or two promotions, but at the rear end of their career they could secure five or six quick and accelerated promotions. A quickly erected structure lacks stability and durability and similarly these instantly developed top executives lacked the vision and foresight that their job demanded. It is all like tiny feet holding very big boots. They lacked expertise in modern business management needed for administering a huge corporate organization and motivating and activating several thousands of staff members in a goal oriented direction. The new top management inherited status and ego, but lacked personality and image to motivate, vision to foresee and commitment to supply a long-term culture and growth path. Human resource development could not keep pace with the rapid Business growth. Business was appreciating but HRD was depreciating.

MYBANK used to conduct its Board Meetings at different centers of the country every month. It was an occasion for feast and gaiety with nightlong entertainment and revelry. Every director is treated as a VIP guest for the duration of two days. They are provided independent cars and other facilities, but no serious and sincere concern or discussion about the affairs of the Bank would takes place in the meetings. The top most executive body intended to provide collective wisdom and inter disciplinary expertise acts as a mere rubber stamp, leaving the field exclusively to the whims and arbitrary fancies of the Chairman. This absolute power with no in-built checks and controls on the chairman serves as the main crippling effect for the decay and downfall of Nationalized Banking in India.

This atmosphere became a fertile ground for breeding widespread corruption at different centers, starting from the Head Office, and extending to the Zonal or Divisional offices, the Regional office and finally the Branch. Chairmen occupied arbitrary powers in a brief period of contract tenure, sure to be terminated at the near future. They lacked vision, foresight or motivation for long-term building of an edifice or culture for the Bank, but were looking only towards short-term objectives.

Corruption started raising up its ugly head at alarming levels. Along with the growth of business accompanied the growth in NPAs. The new service regulations formulated in the seventies came handy for misuse, and save the face of executives for repeated failures of management that started emerging at every point.

These service regulations referred above are :

• PNB officer employees (Conduct) Regulations, 1977

• PNB officer employees (Discipline and Appeal) Regulations, 1977.

[Regulations of PNB are viewed in this project as a model for study]

The conduct regulations contained 26 clauses. How many in the top management, if asked in a spur, can describe without reference even 50% of these provisions? They all know one regulation by heart i.e. Regulation No.3.1.

All charge sheets (almost 100%) in the Bank are issued alleging non-compliance of this particular conduct regulation. It is an omnibus provision, too wide that it can cover anything and everything under the sun. With this regulation the top management feels safe and secure. This regulation reads as under:

"Every officer employee shall, at all times take all possible steps to ensure and protect the interest of the Bank and discharge his duties with utmost integrity, honesty, devotion and diligence and do nothing which is unbecoming of a bank officer"

In the chapter on misconduct in the literature "Integrity in Public and Services" of mine, I have discussed and covered this regulation in detail and also the clarification from the Department of Personnel and Administrative Reforms, Government of India, in its Office Memorandum, dated 8th February 1977 advising executive authorities not to blindly resort to this provision for initiating disciplinary action against public servants.

Recently when a scheme of VRS was offered by Nationalized Banks in India, it once belied the old popular belief that bank-men are a thriving and happy lot and an island of prosperity. There was a spontaneous and spate of applicants and eligible employees in different cadres in the junior and middle management rushed forward to accept the offer and quit their service. The golden handshake comes to them as a golden opportunity, not in terms of only money value, but as a relief from a life of unending psychosis of threat and fear. Today the bird in hand, i.e. the offer of VRS is better than an unsecured and not dependable future. We felt happy when we entered bank service, let us now terminate the game before we lose it later. These were the sentiments expressed by the senior Scale II and Scale III officers. And if you consider the various schemes for employee benefit offered by the Nationalised Banks over the years, the VRS scheme would rank as the most popular amongst the majority of the employees.

Can this indicate prevalence of job satisfaction or service morale in Nationalized Banks, which attracts the cream of the educated from the society to its fold? This does indicate the most unsatisfactory or negative service conditions within the nationalized banking industry, and a consequent urge on the part of the employees to salvage what best they can and flee quickly to safety than to remain and face the risk or look for better prospects from within. This feeling has come through despite attractive pay and perks for the middle and junior level officers. The accumulation of NPA indicates the miserable state of affairs in the fields of credit management, inspection, audit and control, while the overwhelming response to VRS indicate the total failure of personnel or HRD management in Banks. Fortunately eligibility for applying under VRS is restricted only to certain age groups and employees with the minimum number years of service left. This saves Nationalized banks from a total desertion through a complete exodus of the employees.

Fear of ever impending threat of Charge Sheets and Disciplinary cases is cited by the officer employees in many cases for exercising their option to accept V.R.S and to leave service than to continue. If misconduct, then charge sheet. Why complain? Why not behave properly and eliminate threat of charge sheets from your purview?

No one complains, if charge sheets are served on the really guilty, who misbehave or disobey authority or who are caught involved in corruption. Rarely the bank officers are served charge sheets for administrative disobedience, like unruly behaviour, drunkenness, habitual late attendance, indebtedness or flouting the authority of seniors.

One does not also feels aggrieved if the corrupt and guilty are charged sheeted and maximum penalty awarded. Today the CVC is an open book with total transparency in anti-corruption management. MYBANK in the year 1999 referred only 65 new cases for first stage advisory opinion (including 25 under minor category cases) to the CVC as per information available on its web site. This is less than one case per region. Does it certify that only 40 cases of corruption surfaced in the 3000 and odd branches and over 50 regional/zonal and head offices. MYBANK in fact is serving 1000 to 5000 charge sheets per year and keeping several times the number on hold at any period. In my modest view the expenses for 'staff side cases' and DAC management in the Bank every year may be between Rs.5 to 6 crores. No statistics are available, but it is only a modest estimate, on account of my own personal association with this subject in the Bank for two decades and more and participation in around 50 enquiries as Charged Officer, Defence Assisting Officer or Management witness. Assuming a modest 500 persons at any time engaged in facing enquiries or dealing with charge sheets and enquiries in any other capacity and a minimum monthly outgo of Rs.10,000/- per person, the yearly figure will be Rs.6 Crores.

Innocent and honest employees are served a spate of charge sheets in a routine manner. It may again be asked that if the employees are not at fault, why should the Bank serve them charge sheets? But then why these charge sheets are not finding a place in major Private Banks? How the top management in these Banks are able to sustain accountability and maintain service efficiency without resorting to charge sheets? How multi-national organizations maintain discipline, cleanliness and efficiency of service with substantial yearly growth without charge sheeting their employees now and then? Are there no services with zero level accident rates?

If Charge sheet is the weapon that is able to enforce discipline and cleanliness in services, it is justified. But in an atmosphere where charge sheets are served on some one, so that it fulfills the accountability needs and saves the seniors from explaining chronic situations, it has turned to be counter productive. Today when something goes wrong, an endeavour is then made to find the scapegoats i.e. spot person(s) responsible and serve them charge sheets. In ancient Israel when the community faced calamities like pests, epidemics etc. a search is made to find a suitable goat and on its head all the blame for the sufferings caused to the community was thrown. This animal was then sacrificed to appease the gods and to get the society rid off its problem. This explains the word 'scapegoat'. Charge sheet is not considered as a discipline enforcing process, but as a bureaucratic response to an adverse operational development in the Bank's business. It is an easy, evasive and escapist endeavour.

How does it affect the officers when these proceedings are conducted as per the statutory regulations, providing natural justice to the officer and committing a quasi-judicial approach in the process? Here it is the not the case of bad law, but the bad implementation of the law.

The objective stated by the Railway Board for vigilance management in the Railways is to improve its earnings from the commercial operations. What are the objectives in MYBANK? Does anyone think about the cost and benefit?

The problem at core is that Discipline Management in MYBANK lacks:

• Discipline. It is totally undisciplined to the core.

• Honesty of purpose

• Clear objectives

• Fairness and justice

• And impartiality

It is done for all and sundry purposes, other than creating real discipline or cleanliness or promoting productivity or efficiency in service. In my estimate more amount is spent in disciplinary management than in imparting training to the employees. Can a single Regional Manager in the bank take the challenge of his management skill and show and prove the ability to provide zero level operational errors of serious nature, and bane charge sheets for procedural errors in his region? Are the systems and procedures so imperfect that it is not possible to secure this ideal state? Where is the fault, is it in all operational officer employees all the time, is it in the system and procedures or is it in the management efficiency of the executives, who control and oversee branch functioning?

The situation today is like one professing plant protection and spraying more and more pesticides to only confront growth of more and more pests and weeds. A threadbare analysis of the subject is attempted in a series of literatures on this web-site to reorient Bank officers and equip them better to face the banking environment today and to redeem cleanliness and progress in our society.

But why such an atmosphere prevails in banking industry today? How to redeem Indian banking to the integrity of pre-nationalization days, but retaining the progress and development of the current era? Capacity is good, but without character it turns out to be a calamity. This "C" was with us earlier, but where is it gone today? The search engine has to do this job of locating it and bringing it back.

Start with Personal integrity in public life and services. Let us enforce this development first within ourselves and thereafter start fighting together in groups of like-minded individuals against corruption in public services. This is a lofty aim of mine in this literature. This is a token contribution to move towards this goal. Yes the journey towards a thousand miles does start with a single initial step. As a further token measure I will initiate through efforts of my friends and myself a movement for a CLEAN MYBANK. Let us make clean parts to converge into a clean total -CLEAN INDIA.`