National Bank for Financing Infrastructure and Development General Rules, 2022

On January 28, 2022, the Central Government notifies National Bank for Financing Infrastructure and Development General Rules, 2022.

Key points:

• Term of office of Chairperson and other directors: The Chairperson and the Managing Director, every Deputy Managing Director and every other director who is other than a director nominated by the Central Government shall:
  

1. 1. in case of a director who is other than a director elected under clause (e) of Section 6 of National Bank for Financing Infrastructure and Development Act, 2021, hold office for such term not exceeding five years as the authority nominating or appointing him may determine;
   2. in case of a director elected under clause (e) of the said sub-section, hold office for a term of three years.

Clause (e) of Section 6 of National Bank for Financing Infrastructure and Development Act, 2021

(e) such number of directors not exceeding three, elected by shareholders in such manner as may be prescribed, such that a shareholder, other than the Central Government, holding ten per cent. or more of the total issued equity share capital may nominate one director;

• Other terms and conditions of service of directors other than whole-time directors: Every director, other than a director who is an officer of the Central Government or is a whole-time director, shall be entitled to receive such sitting fee for attending meetings of the Board and committees as may be determined by the Board on the recommendation of the Nomination and Remuneration Committee, subject to such fee not exceeding such limit as may apply in respect of sitting fee applicable to a director of a company under the Companies Act, 2013.
  
• Induction of independent directors: The Nomination and Remuneration Committee shall formulate criteria for qualifications, positive attributes and independence of independent directors and recommend the same to the Board for its determination, and while formulating the criteria for independence, the committee may take into consideration, among others, the following aspects relating to individuals to be appointed as independent director:
  

1. 1. whether the individual or his relative is or was a promoter or director or employee of the Institution;
   2. whether the individual or his relative has or had a material pecuniary relationship with the Institution;
   3. whether the individual or his relative is or was an employee or proprietor or partner in a firm of auditors, company secretaries or cost accountants of, or in a legal or consulting firm having material transactions with, the Institution;
   4. whether the individual or his relative is or was a chief executive or director of any non-profit organisation that has material receipts from the Institution or any of its promoters or directors;
   5. whether the individual or his relative holds shares in excess of two per cent. in, or is a material supplier, service provider or customer of, or is a lessor or lessee of, the Institution;
   6. whether the individual or his relative holds or has held any other security of or interest in the Institution of face value exceeding fifty lakh rupees or two per cent. of the paid-up capital of the Institution; and
   7. whether the individual or his relative is or was indebted to, or has or had given a guarantee or provided any security in connection with indebtedness of any third person to the Institution, in excess of such amount as the Nomination and Remuneration Committee may determine.