Leadership can make the difference between an adequate, a good or a great organization. Research tells us that great leaders outperform average ones in many ways, including higher productivity, lower employee turnover, better client services, and greater employee morale and motivation. Given the potential leadership drain in the forth coming years in the banking sector as baby boomers retire, the challenge is that leaders will become increasingly hard to find. The Private sector banks do not escape this reality and, in fact, faces some profound and unique challenges in finding able leaders. This paper aims at identifying the challenges faced by private sector banks and to study the means through which the banks face their challenge of filling in the leadership gaps and what are the leadership competencies required and also provides a benchmark against leading-edge leadership and management development activities. Banks are, struggling to develop and sustain competitive advantage in an increasingly challenging business environment, are now beginning to invest more time and money in leadership development activities than at any time in the past.