SBI salaries sees 47% rise, beat ICIC Bank
04 Mar 2014
The State Bank of India (SBI), the country's largest lender, has raised salaries by 47 per cent between the financial year 2011 and the December quarter of the just-ending FY14 – 67 per cent higher than the privately owned ICICI Bank, a report from IDFC Institutional Securities shows.
The figures show that SBI's average salary per employee is Rs10 lakh, compared to the Rs6 lakh paid by ICICI Bank.
The report shows that state-owned SBI's average employee salary has risen 47 per cent over FY11 (after the impact of pay hikes), while its better-performing private sector peer ICICI Bank's average salary has declined 22 per cent over the same period.
The report added that most of the sharp increase in employee costs for government-owned bank has come after a hike in compensation levels in FY11 and also because part of employee compensation for public sector banks is directly linked to inflation indices.
The IDFC report came even as SBI on Monday announced a 150 per cent (Rs15 per share) interim dividend for 2013-14.
For the three months ended 31 December 2013, SBI's total payment to employees at Rs4,512 crore was up 25.05 per cent from Rs3,608 crore in the same period last year.
The bank had reported a net profit of Rs2,234.34 crore for the quarter ended 31 December, down 34 per cent from a year ago, on higher bad loans and increased provisioning.
The bank saw provisions worth Rs3,429 crore for non-performing assets (NPAs) during the quarter, up 24 per cent from a year ago.
''While ICICI has clearly been tightening its belt, SBI's salaries are to some extent indirectly linked to inflation in the domestic economy, preserving the employee's purchasing power over the longer term,'' the report said.
A part of SBI's salaries are in the form of long-term retiral benefits and, therefore, are not a part of take-home salaries. Retirement benefits were close to 22 per cent of SBI's employee costs in April-January period of fiscal 2014.
