Public sector bank chairmen and executive directors will have to wait for some more time to see their purse swelling, as government is in favour of maintaining uniformity in pay structures of all of its nominees.
"All government nominees including bank chairmen are appointed by Appointments Committee of Cabinet. So, you can't have different salary structures for bank chairmen and other heads of PSUs," a finance ministry official told PTI on Wednesday.
However, there is an indication that the government is inclined in offering performance-based incentives and hiking the allowances.
Indian Banks Association has pitched for hiking salaries of the bank top brass for quite some time and had taken up the matter with the finance ministry.
Though the finance ministry may have favoured the notion of rewarding better performing bankers, the official said, "The proposal has to go through the Department of Public Enterprises, as it is the case of all PSUs."
Since bank chairmen and executive directors are treated at par with their counterparts in other state-owned companies, their salary structure are also same.
Bank chairmen on an average get Rs 25,000 a month apart from various benefits like accommodation, car and travel allowances.
If the government approves the demand of the banking industry, there might be a snow-balling effect and PSUs of other sectors would also demand similar hikes.
"If you talk about performance, the PSU oil companies and insurers are also posting hefty profits," the official said ruling out a discriminatory approach for government nominees in various sectors.
Senior bankers said PSU banks are not able to attract the best talents, as even management graduates passing out of reputed B-schools demand salaries higher than that of a chairman.
"We can't offer a professional more than what a chairman gets," a PSU bank chief said.
Moreover, most of the top ranking management graduates prefer to go to private and foreign banks as they offer better career growth.
Sources in the government circle feel that the issue of salary hike of PSU top brass may be considered when the government considers functional autonomy to all profit making PSUs. Though the finance ministry has granted managerial and functional autonomy to banks, other PSUs are yet to get it.
