Wage revision- SBI to provide for additional Rs 11,000 crore
时间:2024-06-26 08:37:41 阅读(143)
State Bank of India (SBI) will likely make additional provisions of Rs 11,000 crore in H2FY24 to meet requirements for the 17% wage hike following the pact signed between the bank unions and the Indian Banks’ Association (IBA) on December 17, two senior bank officials told FE.
“As per our estimation, a total of Rs 20,000 crore of provision is needed to meet a 17% wage hike for employees and pensioners. We have made about Rs 9,000 crore of provisions till Q2FY24 and will make another Rs 11,000 crore in H2FY24,” a senior official said.
“The biggest bank-wise impact from catch-up provisions on book value for FY25E would be for SBI at 2.5% while BoB would be the least impacted at below 1%,” the report said. Further, in FY25, banks’ total employee expenses would be flattish to marginally down given catch-up provisions in the base of FY24, it added.
SBI had a strong employee base of 235,858 staff as of March 2023. The incremental provisions will take into account the rise in employee and pensioners wages, including higher dearness allowance. SBI did not formally respond to queries till the time of going to press.
“The new pay scales will be constructed after merging dearness allowance corresponding to 8088 points (average index point as applicable for the quarter of July, August and September, 2021) to the basic pay as on 31.10.2022, and adding thereon a loading of 3%, amounting to Rs 1,795 crore,” according to the MoU signed between the IBA and the unions.
The wage revision will be effective November 1, 2022 for a period of five years and the annual increase in salary and allowances will be 17% of the annual pay slip expenses for FY22.
Bank of Baroda has made Rs 1,320 crore of provisions, taking into account an 18% wage hike till Q2FY24, and accordingly will not be required to make higher provisions during Q3FY24, a top official said.
Union Bank of India, which has made Rs 1,210 crore of wage-related provisions till September considering a 15% wage hike, will add over Rs 200 crore of provisions in Q3FY24, a source said.
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