I refer to your editorial titled ‘Interference in the Banking Sector’ published in the Business Times last Sunday.
The Government of Sri Lanka by virtue of its shareholding through state institutions in the Commercial Bank (or for that matter any other bank or company) has a right to appoint persons to the Board of Directors just as much as any other person with the same shareholding power has a right to do so. So long as the appointment is in accordance with the provisions of the Companies Act and the Articles of Association of the company it is not for anybody to question the exercise of such a democratic shareholder right let alone attach any personal motive to it.
If the maximum number of persons in the Board of Directors is limited then it is only natural that a Director retiring from office at the Annual General Meeting would not be re-elected in order to pave the way for the new appointment to take effect.
What is important is that the regulator should ensure that any person who is to be appointed to the Board of Directors of a Bank conforms to the ‘fit and proper’ test irrespective of whether the person responsible for the appointment is the Government of Sri Lanka or any other shareholder.
Rohan Fernando,
Mount Lavinia
|
E-mail
