Section 10BB of the Banking Regulation Act, 1949 empowers the Reserve Bank to appoint a chairman of the Board of directors (on a whole-time basis) or a managing director of a banking company where that office is vacant and its continuation is likely to adversely affect the interests of the company. Under sub-section (2), such a person shall hold office for such period not exceeding:

Section 10BB(2), inserted by the Banking Laws (Amendment) Act, 1983 (Act 1 of 1984) with effect from 15 February 1984, provides that the chairman or managing director appointed by the Reserve Bank under sub-section (1) shall be in the whole-time employment of the banking company and shall hold office for such period not exceeding three years as the Reserve Bank may specify, but shall — subject to other provisions of the Act — be eligible for reappointment. Under sub-section (3), such person shall draw from the banking company such pay and allowances as the Reserve Bank may determine and may be removed from office only by the Reserve Bank. The person so appointed is also deemed to be a director of the banking company if they were not already one.