16. Offices, branches and agencies.—(1) Unless otherwise provided by the Central Government, by
notification in the Official Gazette, the Central Office of the State Bank shall be at 5
[Mumbai, and shall
also be known as Corporate Centre].
(2) The State Bank shall have local head offices in 6
[Mumbai, Kolkata and Chennai] and at such other
places in India as the Central Government, in consultation with the Central Board, may determine.
(3) The State Bank shall maintain as its branches or agencies, all branches or agencies of the Imperial
Bank which were in existence 7
[in India] immediately before the appointed day, and no such branch may
be closed without the previous approval of the Reserve Bank.
(4) The State Bank may establish branches or agencies at any place in or outside India in addition to
the branches or agencies referred to in sub-section (3).
(5) Notwithstanding anything contained in sub-section (4), the State Bank shall establish not less than
four hundred branches in addition to the branches referred to in sub-section (3) within five years of the
appointed day or such extended period as the Central Government may specify in this behalf, and the
places where such additional branches are to be established shall be determined in accordance with any
such programme as may be drawn up by the Central Government from time to time in consultation with
the Reserve Bank and the State Bank, and no branch so established shall be closed without the previous
approval of the Reserve Bank.
17. Management.—(1) The general superintendence and direction of the affairs and business of the
State Bank shall be entrusted to the Central Board which may exercise all powers and do all such acts and
things as may be exercised or done by the State Bank and are not by this Act expressly directed or
required to be done by the State Bank in general meeting.
1. Subs. by Act 27 of 2010, s. 8, for “in computer floppies or diskettes” (w.e.f. 15-9-2010).
2. Ins. by Act 8 of 1997, s. 4 (w.e.f. 15-1-1997).
3. Subs. by Act 3 of 1993, s. 7, for section 15 (w.e.f. 15-10-1993).
4. The proviso and Explanation ins. by Act 8 of 1997, s. 5 (w.e.f. 15-1-1997).
5. Subs. by Act 27 of 2010, s. 9, for “Bombay” (w.e.f. 15-9-2010).
6. Subs. by s. 9, ibid., for “Bombay, Calcutta and Madras” (w.e.f. 15-9-2010).
10
(2) The Central Board in discharging its functions shall act on business principles, regard being had to
public interest.
18. Central Board to be guided by directions of Central Government.—(1) In the discharge of its
functions 1*** the State Bank shall be guided by such directions in matters of policy involving public
interest as the Central Government may, in consultation with the Governor of the Reserve Bank and the
chairman of the State Bank, give to it.
(2) 2
[All directions shall be given by the Central Government] and, if any question arises whether a
direction relates to a matter of policy involving public interest, the decision of the Central Government
thereon shall be final.
19. Composition of the Central Board.—3*** The Central Board shall consist of the following,
namely:
(a) a chairman 4*** to be appointed by the Central Government in consultation with the Reserve
Bank 5***.
6
[(b) such number of managing directors not exceeding four, as may be appointed by the Central
Government in consultation with the Reserve Bank;]
7
* * * * *
(c) if the total amount of the holdings of the shareholders, other than the 8
[Central Government],
whose names are on the 9
[register of shareholders] three months before the date fixed for election of
directors is—
(i) not more than ten per cent. of the total issued capital, two directors,
(ii) more than ten per cent. but not more than twenty-five per cent. of such capital three
directors, and
(iii) more than twenty-five per cent. of such capital, four directors, to be elected in the
prescribed manner by such shareholders;
10[(ca) one director, from among the employees of the State Bank, who are workmen, to be
appointed by the Central Government in the manner provided in the rules made under this Act;
(cb) one director, from among such of the employees of the State Bank, as are not workmen, to be
appointed by the Central Government in the manner provided in the rules made under this Act];
(d) not less than two and not more than six directors to be nominated by the Central
Government 11***, from among persons having special knowledge of the working of co-operative
institutions and of rural economy or experience in commerce, industry, banking or finance;]
(e) one director to be nominated by the Central Government; and
12[(f) one director, possessing necessary expertise and experience in matters relating to regulation
or supervision of commercial banks to be nominated by the Central Government on the
recommendation of the Reserve Bank.]
1. The words “including those relating to a subsidiary bank” omitted by Act 19 of 2018, s. 4 (w.e.f. 1-4-2017).
2. Subs. by Act 32 of 2007, s. 6, for “All directions given by the Central Government shall be given through the Reserve Bank”
(w.e.f. 29-6-2007).
3. The brackets and figure “(1)” omitted by Act 3 of 1994, s. 8 (w.e.f. 15-10-1993).
4. Certain words omitted by Act 73 of 1976, s. 4 (w.e.f. 11-6-1976).
5. The words “and a vice-chairman” omitted by Act 27 of 2010, s. 10 (w.e.f. 15-9-2010).
6. Subs. by s. 10, ibid., for clause (b) (w.e.f. 15-9-2010).
7. Omitted by s. 10, ibid. (w.e.f. 15-9-2010).
8. Subs. by Act 32 of 2007, s. 7, for “Reserve Bank” (w.e.f. 29-6-2007).
9. Subs. by Act 3 of 1994, s. 8, for “Principal register” (w.e.f. 15-10-1993).
10. Ins. by Act 48 of 1973, s. 3 (w.e.f. 1-7-1974).
11. The words “in consultation with the Reserve Bank” omitted by Act 27 of 2010, s. 10 (w.e.f. 15-9-2010).
12. Subs. by s. 10, ibid., for clause (f) (w.e.f. 15-9-2010).
11
1
* * * * *
2
[19A. Qualifications for election of directors elected by shareholders.—(1) The directors elected
under clause (c) of section 19 shall—
(a) have special knowledge or experience in respect of one or more of the following areas,
namely:—
(i) agriculture and rural economy,
(ii) banking,
(iii) co-operation,
(iv) economics,
(v) finance,
(vi) law,
(vii) small-scale industry,
(viii) any other area the special knowledge of, and experience in, which in the opinion of the
Reserve Bank shall be useful to the State Bank;
(b) represent the interests of depositors; or
(c) represent the interests of farmers, workers and artisans.
(2) Without prejudice to the provisions of sub-section (1) and notwithstanding anything to the
contrary contained in this Act or in any other law for the time being in force, no person shall be eligible to
be elected as director under clause (c) of section 19 unless he is a person having fit and proper status
based upon track record, integrity and such other criteria as the Reserve Bank may notify from time to
time in this regard and the Reserve Bank may specify in the notification issued under this sub-section, the
authority to determine the fit and proper status, the manner of such determination, the procedure to be
followed for such determinations and such other matters as may be considered necessary or incidental
thereto.
(3) Where the Reserve Bank is of the opinion that any director of the State Bank elected under clause
(c) of section 19 does not fulfil the requirements of sub-sections (1) and (2), it may, after giving to such
director and the State Bank a reasonable opportunity of being heard, by order, remove such director.
(4) On the removal of a director under sub-section (3), the Central Board shall co-opt any other
person fulfilling the requirements of sub-sections (1) and (2), as a director in place of the person so
removed, till a director is duly elected by the shareholders of the State Bank in the next annual general
meeting; and the person so co-opted shall be deemed to have been duly elected by the shareholders of the
State Bank as a director.
19B. Power of Reserve Bank to appoint additional directors.—(1) If the Reserve Bank is of the
opinion that in the interest of banking policy or in the public interest or in the interests of the State Bank
or its depositors, it is necessary so to do, it may, from time to time and by order in writing appoint, with
effect from such date as may be specified in the order, one or more persons as additional directors of the
State Bank.
(2) Any person appointed as additional director under sub-section (1) shall,—
(a) hold office during the pleasure of the Reserve Bank and subject thereto for a period not
exceeding three years or such further periods not exceeding three years at a time as the Reserve Bank
may, by order, specify;
1. Sub-section (2) and (3) omitted by Act 35 of 1964, s. 3 (w.e.f. 1-12-1964).
2. Ins. by Act 27 of 2010, s. 11 (w.e.f. 15-9-2010).
12
(b) not incur any obligation or liability by reason only of his being an additional director or for
anything done or omitted to be done in good faith in the execution of the duties of his office or in
relation thereto; and
(c) not be required to hold qualification shares in the State Bank.
(3) For the purpose of reckoning any proportion of the total number of directors of the State Bank any
additional director appointed under this section shall not be taken into account.]
20. Term of office of chairman, managing director, etc.—(1) 1
[The chairman, 2*** and each
managing director] shall hold office for such term not exceeding five years, as the Central Government
may fix when appointing them and shall be eligible for reappointment.
3
[(1A) Notwithstanding anything contained in sub-section (1), the Central Government shall have the
right to terminate the terms of office of the chairman, 2*** or a managing director, as the case may be, at
any time before the expiry of the term fixed under sub-section (1) by giving him notice of not less than
three months in writing or three months’ salary and allowances in lieu of such notice; and the chairman,
2
*** or a managing director, as the case may be, shall also have the right to relinquish his office at any
time before the expiry of the term so fixed by giving to the Central Government notice of not less than
three months in writing.]
4
* * * * *
(3) Subject to the provisions contained in section 19 and 5*** a director elected under clause (c) 6***
of 7
[that section] shall hold office for 8
[three years] and 9 *** 10 *** and shall be eligible for reelection 11***:
12[Provided that no such director shall hold office continuously for a period exceeding six years.]
13[(3A) 14[subject to the provisions contained in sub-section (4), a director] appointed under clause
(ca) or clause (cb) 15[of section 19 or nominated under clause (d) of that section] shall hold office for such
term, not exceeding three years, as the Central Government may specify 16*** and shall be eligible 17[for
re appointment or re-nomination, as the case may be:]]
12[Provided that no such director shall hold office continuously for a period exceeding six years.]
18[(4) A director appointed under clause (ca) or clause (cb) 19[of section 19 or nominated under clause
(d) or clause (e) or clause (f) of that section] shall hold office during the pleasure of the authority
appointing or nominating him, as the case may be.]
1. Subs. by Act 73 of 1976, s. 4, for “The chairman and the vice-chairman” (w.e.f. 11-6-1976).
2. The words “, vice-chairman” omitted by Act 27 of 2010, s. 12 (w.e.f. 15-6-2010).
3. Ins. by Act 73 of 1976, s. 4 (w.e.f. 11-6-1976).
4. Omitted by s. 4, ibid. (w.e.f. 11-6-1976).
5. The words, brackets and figures “and in sub-section (5)” omitted by Act 66 of 1988, s.12 (w.e.f. 8-7-1992).
6. The words, brackets and figures “of sub-section (1)” omitted by Act 3 of 1994, s. 9 (w.e.f. 15-10-1993).
7. Subs. by Act 66 of 1988, s. 12, for certain words (w.e.f. 8-7-1992).
8. Subs. by s. 12, ibid., for “four years” (w.e.f. 8-7-1992).
9. The words “and thereafter until his successor shall have been duly elected” omitted by Act 45 of 2006, s. 14
(w.e.f. 16-10-2006).
10. The words “or nominated” omitted by Act 66 of 1988, s. 12 (w.e.f. 8-7-1992).
11. The words “or re nomination” omitted by s. 12, ibid. (w.e.f. 8-7-1992).
12. Ins. by s. 12, ibid. (w.e.f. 8-7-1992).
13. Ins. by Act 48 of 1973, s. 4 (w.e.f. 1-7-1974).
14. Subs. by Act 66 of 1988, s. 12, for “A director” (w.e.f. 8-7-1992).
15. Subs. by Act 3 of 1994, s. 9, for certain words (w.e.f. 15-10-1993).
16. The words “and thereafter until his successor shall have been duly appointed or nominated” omitted by Act 27 of 2010, s. 12
(w.e.f. 15-9-2010).
17. Subs. by Act 66 of 1988, s. 12, for certain words (w.e.f. 8-7-1992).
18. Subs. by s. 12, ibid., for sub-section (4) (w.e.f. 8-7-1992).
19. Subs. by Act 3 of 1994, s. 9, for certain words (w.e.f. 15-10-1993).
13
1
* * * * *
2
[21. Local Boards.—(1) There shall be constituted at each place where the State Bank has a local
head office, a Local Board which shall consist of the following members, namely:—
3
[(a) the chairman, ex officio or the managing director nominated by the chairman;]
4
[(b) all such directors elected or nominated to the Central Board under clause (c) or clause (d) of
section 19 as are ordinarily resident in the area falling within the jurisdiction of the local head office;]
(c) six members to be nominated by the Central Government 5***;
6
* * * * *
(e) 7
[the Chief General Manager] of the local head office, appointed by the State Bank, ex officio.
8
[(2) Where as a result of the establishment of any local head office (hereinafter referred to as the new
local head office) for any area which is already falling within the jurisdiction of another local head office
(hereinafter referred to as the existing local head office) a Local Board (hereinafter referred to as the new
Local Board) is constituted for the new local head office, any person who is, at the time of such
Constitution, holding office as a member of a Local Board (hereinafter referred to as the existing Local
Board) for an existing local head office under clause (c) of sub-section (1) and is ordinarily resident in the
area falling within the jurisdiction of the new local head office, shall cease to hold office as member of
the existing Local Board and shall become a member of the new Local Board and shall on becoming such
member be deemed to have been nominated to the new Local Board and shall hold office as such member
for the unexpired portion of his term of office as a member of the existing Local Board.]
(3) Any vacancy caused in the existing Local Board as a result of any member thereof becoming a
member of the new Local Board under sub-section (2) shall be deemed to be a casual vacancy and be
filled in accordance with the provisions of section 25.
9
* * * * *
10[(5) The 11[Central Government] shall, in consultation with the chairman, appoint—
(a) a member of a Local Board nominated under clause (c) of sub-section (1) to be the president
thereof; and
(b) a member of a Local Board holding office under clause (b) or nominated under clause (c) of
that sub-section to be the vice-president thereof.]
12[21A. Term of office of members of Local Board.—13[(1) Subject to the provisions contained in
this section and in sub-section (2) of section 21, a member of a Local Board—
(a) nominated under clause (c) of sub-section (1) of section 21 shall hold office for such term, not
exceeding three years, as the Central Government may specify in this behalf 14***;
1. Omitted by Act 66 of 1988, s. 12 (w.e.f. 8-7-1992).
2. Subs. by Act 35 of 1964, s. 5, for section 21 (w.e.f. 1-12-1974).
3. Subs. by Act 27 of 2010, s. 13, for clause (a) (w.e.f. 15-9-2010).
4. Subs. by Act 3 of 1994, s. 10, for clause (b) (w.e.f. 15-10-1993).
5. The words “in consultation with the Reserve Bank” omitted by Act 27 of 2010, s. 13 (w.e.f. 15-9-2010).
6. Omitted by Act 3 of 1994, s. 10(w.e.f. 15-10-1993).
7. Subs. by Act 48 of 1973, s. 5, for “the Secretary and Treasurer” (w.e.f. 1-7-1974).
8. Subs. by Act 3 of 1994, s. 10, for sub-section (2) (w.e.f. 15-10-1993).
9. Omitted by s. 10, ibid. (w.e.f. 15-10-1993).
10. Subs. by s. 10, ibid., for sub-section (5) (w.e.f. 15-10-1993).
11. Subs. by Act 27of 2010, s. 13, for “Governor of the Reserve Bank” (w.e.f. 15-9-2010).
12. Ins. by Act 35 of 1964, s. 6 (w.e.f. 1-12-1964).
13. Subs. by Act 66 of 1988, s. 13, for sub-section (1) (w.e.f. 15-10-1993).
14. The words “and thereafter until his successor has been duly nominated” omitted by Act 45 of 2006, s. 15 (w.e.f. 16-10-2006).
14
(b) elected under clause (d) of sub-section (1) of section 21 shall hold office for three years and
1
***,
and shall be eligible for re-nomination or re-election, as the case may be:
Provided that no such director shall hold office continuously for a period exceeding six years.]
2
* * * * *
(3) A director of the Central Board becoming a member of a Local Board by virtue of the provisions
of clause (b) of sub-section (1) of section 21 shall cease to hold office as such member on his ceasing to
be a director or on his ceasing to be ordinarily resident in the relevant area.
(4) The president and the vice-president of a Local Board shall each hold office for two years or the
remaining period of his office as a member of the Local Board, whichever is shorter, and shall be eligible
for re-appointment so long as he is a member of the Local Board.
3
[(5) A member of a Local Board nominated under clause (c) of sub-section (1) of section 21 shall
hold office during the pleasure of the Central Government.]
4
[21B. Powers of Local Board.—In respect of the area falling within the jurisdiction of the local
head office for which the Local Board has been constituted, a Local Board shall, subject to such general
or special direction as the Central Board may give from time to time, exercise such powers and perform
such duties and functions as may be entrusted or delegated to it by the Central Board.]
21C. Local Committees.—5
[(1) A Local Committee may be constituted by the Central Board for any
area and shall consist of such number of members as may be prescribed.
6
[(2) The chairman or the managing director nominated by him shall be an ex officio member of every
such Local Committee.]
(3) A Local Committee shall exercise such powers and perform such functions and duties as the
Central Board may confer on or assign to it.]
22. Disqualifications for directorship of Central Board or membership of Local Boards or
Committees.—(1) No person shall be qualified to be a director of the Central Board or a member of a
Local Board or of a Local Committee if—
(a) he holds the office of director, provisional director, promoter, agent or manager of any
banking company already established or advertised as about to be established; or
(b) he is a salaried officer of Government not specially authorised by the Central Government to
be a director or member; or
(c) he has been removed or dismissed from the service of Government on a charge of corruption
or bribery; or
(d) he holds any office of profit under the State Bank other than the office of
chairman, 7*** 8
[managing director] or 9
[ 10[Chief General Manager or legal or technical adviser]]; or
1. The words “and thereafter until his successor has been duly nominated” omitted by Act 45 of 2006, s. 15 (w.e.f. 16-10-2006).
2. Omitted by Act 3 of 1994, s. 11 (w.e.f. 15-10-1993).
3. Ins. by Act 66 of 1988, s. 13 (w.e.f. 8-7-1992).
4. Subs. by Act 27 of 2010, s. 14, for section 21B (w.e.f. 15-9-2010).
5. Ins. by Act 35 of 1964, s.6 (w.e.f. 1-12-1964).
6. Subs. by Act 27 of 2010, s. 15, for sub-section (2) (w.e.f. 15-9-2010).
7. The word “vice-chairman” omitted by s. 16, ibid. (w.e.f 15-9-2010).
8. Subs. by Act 26 of 1959, s. 2, for “or managing director” (w.e.f. 11-6-1976).
9. Ins. by Act 35 of 1964, s. 7 (w.e.f. 1-12-1964).
10. Subs. by Act 48 of 1973, s. 7, for “secretary and treasurer” (w.e.f. 26-6-1974).
15
1
[(da) in the case of a director appointed under clause (ca) or clause (cb) 2*** of section 19,—
(i) he is not serving in the State Bank or has not been serving in it for a continuous period of
at least five years; and
(ii) he is of such age that there is a likelihood of his attaining the age of superannuation
during his term of office as a director; or]
(e) he is or at any time has been adjudicated an insolvent or has suspended payment of his debts
or has compounded with his creditors; or
(f) he is declared lunatic or becomes of unsound mind; or
(g) he is or has been convicted of any offence involving moral turpitude; or
3
[(h) in the case of an elected director, he is not registered as a holder in his own right of
unencumbered shares in the State Bank, either as sole holder or as first named holder when jointly
held, of a nominal value of at least five thousand rupees.]
(2) No two persons who are partners of the same firm or are directors of the same private company or
one of whom is an agent of the other or holds a power of attorney from a firm of which the other is a
partner may be directors of the Central Board or members of the same Local Board or Local Committee at
the same time.
(3) The appointment, nomination or election as director or member of a Local Board or of a Local
Committee of any person who is a member of Parliament or the Legislature, of any State shall be void
unless within two months of the date of his appointment, nomination or election he ceases to be a member
of Parliament or the State Legislature, and if any director or member of a Local Board or of a Local
Committee is elected or nominated as a member of Parliament or any State Legislature, he shall cease to
be a director or member of the Local Board or of Local Committee as from the date of such election or
nomination, as the case may be.
4
[(4) In this section,—
(a) “banking company” has the same meaning as in the 5
[Banking Regulation Act, 1949
(10 of 1949)];
(b) “manager” means the chief executive officer, by whatever name called, of a Banking
company;
(c) “private company” has the same meaning as in the Companies Act, 1956 (1 of 1956)].
23 .Vacation of office of directors, etc.—If a director of the Central Board or a member of a Local
Board or a Local Committee—
(a) becomes subject to any of the disqualifications mentioned in section 22; or
(b) resigns his office by giving notice in writing under his hand, in the case of the 6
[chairman 7***
and amanaging director] to the Central Government and in the case of other directors or members of
Local Boards or Committees, to the Central Board, and the resignation is accepted; or
(c) is absent without leave of the Central Board, the Local Board or the Local Committee of
which he is a director or member, as the case may be, for more than three consecutive meetings
thereof;
his seat shall thereupon become vacant.
1. Ins. by Act 48 of 1973, s. 7 (w.e.f. 26-6-1974).
2. The words, brackets and figure “of sub-section (1)” omitted by Act 3 of 1994, s. 13 (w.e.f. 15-10-1993).
3. Subs. by Act 27 of 2010, s. 16, for clause (h) (w.e.f. 15-9-2010).
4. Ins. by Act 26 of 1959, s. 2 (w.e.f. 28-8-1959).
5. Subs. by Act 3 of 1994, s. 13, for “Banking Companies Act, 1949” (w.e.f. 15-10-1993).
6. Subs. by Act 73 of 1976, s. 4, for “the chairman and vice-chairman” (w.e.f.11-6-1976).
7. The word “, vice-chairman” omitted by Act 27 of 2010, s. 17 (w.e.f. 15-9-2010).
16
1
[Provided that nothing in clause (c) shall apply to the chairman in relation to his membership of a
Local Board or of a Local Committee.]
24. Removal from office of directors, etc.—(1) The Central Government may, after consulting the
Reserve Bank, remove from office 2
[the chairman 3*** or a managing director.]
4
* * * * *
(3) The Central Government, 5*** may remove from office any director6
[appointed under clause (ca)
or clause (cb) or nominated under clause(d) 7
[of section 19] 8
[or any member of a Local Board nominated
under clause (c) of sub-section (1) of section 21] and 9
[appoint or nominate, as the case may be], in his
stead another person to fill the vacancy.
(4) The shareholders, other than the 10[Central Government], may, by a resolution passed by majority,
of the votes of such shareholders holding in the aggregate not less than one-half of the share capital held
by all such shareholders, remove any director elected under clause (c) 11***of section 19 and elect in his
stead another person to fill the vacancy.
12* * * * *
(6) No person shall be removed from his office under sub-section (1) 13*** or sub-section (3) unless
he has been given an opportunity of showing cause against his removal.
14[24A. Supersession of Central Board in certain cases.—(1) Where the Central Government, on
the recommendation of the Reserve Bank is satisfied that in the public interest or for preventing the
affairs of the State Bank being conducted in a manner detrimental to the interest of the depositors or the
State Bank or for securing the proper management of the State Bank, it is necessary so to do, the Central
Government may, for reasons to be recorded in writing, by order, supersede the Central Board for a
period not exceeding six months as may be specified in the order:
Provided that the period of supersession of the Central Board may be extended from time to time, so,
however, that the total period shall not exceed twelve months.
(2) On supersession of the Central Board under sub-section (1), the Central Government may, in
consultation with the Reserve Bank, appoint an Administrator (not being an officer of the Central
Government or a State Government) who has experience in law, finance, banking, economics or
accountancy, for such period as it may determine.
(3) The Central Government may issue such directions to the Administrator as it may consider
necessary and the Administrator shall be bound to follow such directions.
(4) Notwithstanding anything contained in this Act, upon making the order of supersession of the
Central Board—
(a) the chairman, managing director and other directors shall, as from the date of supersession,
vacate their offices as such;
(b) all the powers, functions and duties which may, by or under the provisions of this Act or any
other law for the time being in force, be exercised and discharged by or on behalf of the Central
Board, or by a resolution passed in the general meeting of the State Bank, shall, until the Central
1. The proviso added by Act 21 of 1957, s. 3 (w.e.f. 11-6-1976).
2. Subs. by Act 73 of 1976, s. 4, for “the chairman or the vice-chaiman” ( w.e.f. 11-6-1976).
3. The word “, vice-chairman” omitted by Act 27 of 2010, s. 18 (w.e.f. 15-9-2010).
4. Omitted by Act 73 of 1976, s. 4 (w.e.f. 11-6-1976).
5. The words “after consulting the Reserve Bank,” omitted by Act 27 of 2010, s. 18 (w.e.f. 15-9-2010).
6. Subs. by Act 48 of 1973, s. 8, for “nominated under clause (d)” (w.e.f. 1-7-1974).
7. Subs. by Act 3 of 1994, s. 14, for “sub-section (1) of section 19” (w.e.f. 15-10-1993).
8. Ins. by Act 35 of 1964, s. 8 (w.e.f. 1-12-1964).
9. Subs. by Act 48 of 1973, s. 8 for “nominate” (w.e.f. 1-7-1974).
10. Subs. by Act 32 of 2007, s. 8, for “Reserve Bank” (w.e.f. 29-6-2007).
11. Certain words omitted by Act 3 of 1994, s. 14 (w.e.f. 15-10-1993).
12. Omitted by s. 14, ibid. (w.e.f. 15-10-1993).
13. The words, bracket and figure “or sub-section (2)” omitted by Act 73 of 1976, s. 4 (w.e.f. 11-6-1976).
14. Ins. by Act 27 of 2010, s. 19 (w.e.f. 15-9-2010).
17
Board is reconstituted, be exercised and discharged by the Administrator appointed under subsection (2):
Provided that the powers exercised by the Administrator shall be valid notwithstanding that such
power is also exercisable by a resolution passed in the general meeting of the State Bank.
(5) The Central Government may, in consultation with the Reserve Bank, constitute a committee of
three or more persons who have experience in law, finance, banking, economics or accountancy to assist
the Administrator in the discharge of his duties.
(6) The committee shall meet at such times and places and observe such rules of procedure as may be
specified by the rules made under this Act.
(7) The salary and allowances of the Administrator and the members of the committee shall be such
as may be specified by the rules made under this Act and be payable by the State Bank.
(8) On and before the expiration of two months before the expiry of the period of supersession of the
Central Board, the Administrator of the State Bank shall call the general meeting of the State Bank to
elect new directors and re-constitute the said Board.
(9) Notwithstanding anything contained in any other law for the time being in force or in any
contract, no person shall be entitled to claim any compensation for the loss or termination of his office on
supersession of the Central Board.
(10) The Administrator appointed under sub-section (2) shall vacate office immediately after the reconstitution of the Central Board.]
25. Casual vacancies.—1
[(1) If the chairman, 2*** or a managing director is rendered incapable of
discharging his duties by reason of infirmity or otherwise or is absent on leave or otherwise in
circumstances not involving the vacation of his office, the Central Government may, in consultation with
the Reserve Bank, appoint another person to officiate in the vacancy.]
3
[(2) Where any vacancy occurs before the expiry of the term of office of a director, other than the
Chairman, 2*** or a managing director or 4
[a director appointed under clause (ca) or 5
[clause (cb) of
section 19 or of a member of a Local Board other than the Chief General Manager] the vacancy shall be
filled—
(a) in the case of an elected director, by election; and
(b) in the case of a director nominated under clause (d) of section 19 or a member of a Local
Board nominated under clause (c) of sub-section (1) of section 21, by nomination 6***:
Provided that where the duration of the vacancy in the office of an elected director is likely to be less
than six months, the vacancy may be filled by the remaining directors] by co-opting a person not
disqualified under section 22.]
(3) A person elected or nominated or co-opted, as the case may be, 7
[under sub-section (2)] shall hold
office for the unexpired portion of the term of his predecessor.
8
[(4) Where any vacancy occurs before the expiry of the term of office of a director appointed under
clause (ca) or clause (cb) 9*** of section 19, such vacancy shall be filled in accordance with the said
clause (ca) or as the case may be, clause (cb), and the director so appointed shall hold office for the period
specified under sub-section (3A) of section 20.]
1. Subs. by Act 73 of 1976, s. 4, for sub-section (1) w.e.f. 11-6-1976).
2. The word “, vice-chairman” omitted by Act 27 of 2010, s. 20 (w.e.f. 15-9-2010).
3. Subs. by Act 35 of 1964, s. 9, for sub-section (2) (w.e.f. 1-12-1964).
4. Subs. by Act 48 of 1973, s. 9, for certain words (w.e.f. 1-7-1974).
5. Subs. by Act 3 of 1994, s. 15, for certain words, brackets, letters and figure (w.e.f. 15-10-1993).
6. The words “in consultation with the Reserve Bank” omitted by Act 27 of 2010, s. 20 (w.e.f. 15-9-2010).
7. Subs. by Act 48 of 1973, s. 9, for “under this section” (w.e.f. 1-7-1974).
8. Ins. by s. 9, ibid. (w.e.f. 1-7-1974).
9. The words, brackets and figure “by sub-section (1)” omitted by Act 3 of 1994, s. 15 (w.e.f. 15-10-1993).
18
26. Remuneration of directors.—(1) Without prejudice to the provisions contained in sections 27,
28 and 29, the directors shall be paid such fees and allowances for attending the meetings of the Central
Board or of any of its Committees and for attending to any other work of the State Bank as may be
prescribed.
(2) Notwithstanding anything contained in sub-section (1), no fees shall be payable to a managing
director or any other director who is an officer of the Central Government or the Reserve Bank.
27. Powers and remuneration of chairman.—(1) The Chairman shall preside at all meetings of the
Central Board and subject to such general or special directions as the Central Board may give, exercise all
such powers and do all such acts and things as may be exercised or done by the State Bank.
(2) The chairman shall receive such salary, fees, allowances and perquisites1
[as may be determined
by the Central Government].
2
* * * * *
28. [Powers and remuneration of vice-chairman.] Omitted by the State Bank of India (Amendment)
Act, 2010 (27 of 2010), s. 21 (w.e.f. 15-9-2010).
29. Powers and remuneration of managing director.—(1) A managing director—
(a) shall be a whole-time officer of the State Bank; 3***
(b) subject to the general control of the chairman 4***, shall exercise such powers and perform
such duties as may be entrusted or delegated to him by the Central Board 5
[; and]
5
[(c) when authorised by the chairman, shall preside at the meetings of the Central Board in his
absence.]
(2) A managing director shall receive such salary and allowances6
[as may be determined by the
Central Government].
7
* * * * *
30. Executive and other committees of the Central Board.—The Central Board may constitute
such and so many committees, including an executive committee, of itself as it deems fit to exercise such
powers and perform such duties as may, subject to such conditions, if any, as the Central Board may
impose, be delegated to them by the Central Board.
31. Meetings of the Central Board.—8
[(1) The Central Board shall meet at such time and place and
shall observe such rules of procedure in regard to the transaction of business at its meetings as may be
prescribed; and the meeting of the Central Board may be held by participation of the directors of the
Central Board through videoconferencing or such other electronic means, as may be prescribed, which are
capable of recording and recognising the participation of the directors and the proceedings of such
meetings are capable of being recorded and stored:
Provided that the Central Government may in consultation with the Reserve Bank, by notification in
the Official Gazette, specify the matters which shall not be discussed in a meeting of the Central Board
held through videoconferencing or such other electronic means.
(2) All questions at the meeting shall be decided by a majority of the votes of the directors present in
the meeting or through videoconferencing or such other electronic means and in the case of equality of
votes the chairman or, in his absence, the managing director authorised by the chairman shall have a
second or casting vote.]
1. Subs. by Act 73 of 1976, s. 4, for certain words (w.e.f. 11-6-1976).
2. The proviso omitted by s. 4, ibid. (w.e.f. 11-6-1976).
3. The word “and” omitted by Act 27 of 2010, s. 22 (w.e.f. 15-9-2010).
4. The words “and the vice-chairman” omitted by s. 22, ibid. (w.e.f. 15-9-2010).
5. Ins. by s. 22, ibid. (w.e.f. 15-9-2010).
6. Subs. by Act 73 of 1976, s. 4, for certain words (w.e.f. 11-6-1976).
7. The proviso omitted by s. 4, ibid. (w.e.f. 11-6-1976).
8. Subs. by Act 27 of 2010, s. 23, for sub-section (1) and (2) (w.e.f. 15-9-2010).
19
(3) A director who is directly or indirectly concerned or interested in any contract, loan, arrangement
or proposal entered into or proposed to be entered into by or on behalf of the State Bank shall at the
earliest possible opportunity disclose the nature of his interest to the Central Board and shall not be
present at any meeting of the Central Board when any such contract, loan, arrangement or proposal is
discussed unless his presence is required by the other directors for the purpose of eliciting information,
and no director so required to be present shall vote on any such contract, loan, arrangement or proposal.
1
[Provided that nothing contained in this sub-section shall apply to such director by reason only of his
being—
(i) a shareholder (other than a director) holding not more than two per cent. of the paid-up capital
in any public company as defined in the Companies Act, 1956 (1 of 1956) or any corporation
established by or under any law for the time being in force in India or any co-operative society with
which or to which the State Bank has entered into or made, or proposes to enter into or make, a
contract, loan, arrangement or proposal; or
(ii) a director ex officio of the State Bank 2***,3
[or]]
4 [(iii) an officer or other employee of the State Bank, if he is a director appointed under
clause(ca) or clause (cb) 5*** of section 19.]
(4) If for any reason neither the chairman nor the vice-chairman is able to be present at a meeting of
the Central Board, any director, 6***authorised by the chairman in writing in this behalf, and in the
absence of such authorisation,7
[any director] elected by the directors present from amongst themselves,
shall preside at the meeting and, in the event of equality of votes, shall have a second or casting vote.
8
[31A. Meetings of Local Boards.—(1) A Local Board shall meet at such time and place and shall
observe such rules of procedure in regard to the transaction of business at its meetings as may be
prescribed.
(2) All questions at the meeting shall be decided by a majority of the votes of the members present
and in the case of equality of votes, the person presiding at the meeting shall have a second or casting
vote.
(3) A member who is directly or indirectly concerned or interested in any contract, loan, arrangement
or proposal entered into or proposed to be entered into by or on behalf of the State Bank, shall, at the
earliest possible opportunity, disclose the nature of his interest to the Local Board and shall not be present
at any meeting of the Local Board when any such contract, loan, arrangement or proposal is discussed
unless his presence is required by the other members for the purpose of eliciting information, and no
member so required to be present shall vote on any such contract, loan, arrangement or proposal:
Provided that nothing contained in this sub-section shall apply to such member by reason only of his
being—
(i) a shareholder (other than a director) holding not more than two per cent. of the paid-up capital
in any public company as defined in the Companies Act, 1956 (1 of 1956), or any corporation
established by or under any law for the time being in force in India or any co-operative society, with
which or to which the State Bank has entered into or made or proposes to enter into or make, a
contract, loan, arrangement or proposal; or
(ii) a director ex officio of the State Bank 9***.
1. Ins. by Act 56 of 1962, s. 2 (w.e.f. 1-1-1963).
2. The words “or a director of a subsidiary bank” omitted by Act 19 of 2018, s. 5 (w.e.f. 1-4-2017).
3. Added by Act 48 of 1973, s. 10 (w.e.f. 1-7-1974).
4. Ins. by s. 10, ibid. (w.e.f. 26-6-1976).
5. The words, brackets and figure “of sub-section (1)” omitted by Act 3 of 1994, s. 16 (w.e.f. 15-10-1993).
6. The words “, other than a managing director” omitted by Act 48 of 1973, s. 10 (w.e.f. 1-7-1974).
7. Subs. by s. 10, ibid., for “any such director” (w.e.f. 1-7-1974).
8. Ins. by Act 35 of 1964, s. 10 (w.e.f. 1-2-1964).
9. The words “or a director of a subsidiary bank” omitted by Act 19 of 2018, s. 6 (w.e.f. 1-4-2017).
20
(4) If for any reason neither the president nor the vice-president is able to be present at a meeting of
the Local Board, any member,1
[other than the Chief General Manager] elected by the members present
from amongst themselves, shall preside at the meeting.
(5) Notwithstanding anything contained in this section, the chairman shall preside at any meeting of a
Local Board at which he is present and in the absence of the chairman, 2
[the managing director authorised
by the chairman], shall, whenever he is present, preside at such meetings.]