The Government of India has extended Rajendra Kumar Saboo's additional charge as Managing Director and Chief Executive Officer of UCO Bank by three months, keeping him at the helm of the state-owned lender until November 30, or until a permanent chief is appointed, whichever comes earlier.

The extension confirms that the bank's top office will remain in interim hands while the appointment of a full-time MD & CEO is finalized. Saboo, an Executive Director of the bank, has been discharging the additional charge of chief executive, and the fresh order extends that interim arrangement rather than marking a permanent appointment.

UCO Bank is a public sector bank headquartered in Kolkata, the city where it was founded in 1943. The Government of India holds a majority stake in the lender, which operates under the regulation of the Reserve Bank of India. It is one of 12 public sector banks remaining in the country after the consolidation drive of 2019-20 sharply reduced the number of state-run lenders.

As with India's other state-owned banks, the appointment of UCO Bank's MD & CEO rests with the central government, which makes selections for top posts at public sector lenders based on recommendations from the Financial Services Institutions Bureau, the body that screens candidates for whole-time director positions at state-run banks. The FSIB, which succeeded the earlier Banks Board Bureau in 2022, interviews eligible senior bankers and forwards its picks to the government, with final approval resting with the Appointments Committee of the Cabinet. Full-time chiefs of state-run banks are generally appointed for three-year terms, which can be extended until the superannuation age of 60.

Interim arrangements of this kind are a standard feature of India's public sector banking sector: when a permanent chief has not been appointed by the time a term concludes, the government typically asks a senior executive of the bank to hold additional charge of the office until a full-time appointment is made. The November 30 deadline now sets the outer limit for the current arrangement, meaning the selection process would need to conclude within that window or the interim charge would require a further extension.

Reported by Srabastee Biswas for CNBC-TV18 Markets.