In a recent Economic Times report, the salaries of chief executives officers (CEO) of leading Indian banks was brought to focus over profitability and bad loans. In February this year, the Reserve Bank of India (RBI) proposed changes to the compensation structure of CEOs of private sector banks and wholly owned subsidiaries of foreign banks which would possibly bring down their pay for the current financial year.
Previous year annual reports of top private banks in the country show that the compensation given to CEOs are structured with a fixed pay, variable pay and stock options components. There were restrictions put on remuneration in the form of variable pay. The variable pay along with ESOPs was capped at 200 percent of the fixed pay.
This variable pay is what often drives performance as it is based on improvement of key performance parameters of the bank and how much value was created for the shareholders.
Under former governor Urjit Patel, the RBI was tough on the pay and perks, like bonus, provided to the executives. Earlier the variable pay was capped at 70 percent of the fixed pay. However, ESOPs weren't included. It is now forms a part of the restrictions imposed on variable pay.
The ET report rated top private bank CEOs in India based on their compensation as reported by the banks in their recent annual reports. However, the list did not take into account perks and other privileges due to difference in treatment by banks. Further, Yes Bank was not included in the list as it provides a consolidated figure of the remuneration in its report which includes perquisites given.
Here are the top 6:RankNamePositionBankBasic Monthly Pay 1 Adithya Puri MD HDFC Bank Rs 89 Lakh 2 Amitabh Chaudhry CEO Axis Bank Rs 30 Lakh 3 Uday Kotak MD Kotak Mahindra Rs 27 Lakh 4 Chanda Kochhar Former MD and CEO ICICI Bank Rs 26 Lakh 5 Sandeep Bakhshi CEO since Oct 2018 ICICI Bank Rs 22 Lakh 6 Romesh Sobti CEO IndusInd Bank Rs 16 Lakh