No bonus for PSU bank chiefs for missing targets!
Zee Media Bureau
Mounting bad loans of banks in India are eating into the profitability of the top banking chiefs too!
As per The Economic Times report, CEOs and executive directors of all the state-run banks, will not receive any bonus for 2015-16.
The report said that bonus for top PSU bankers is usually in the range of Rs 10-12 lakh. The senior banking officials have been asked to forgo their bonus as they have not been able to meet the key performance parameters.
The Reserve Bank of India set up asset quality review (AQR) which has stricter review parameters, resulting in many banks reporting losses in the Q3 and Q4 of 2015-16.
Punjab National Bank reported a record Rs 5,367 crore lossess for the Q4, the largest by a PSU bank. While the loan growth of the PSU banks dipped to a 50-year low, the defaults continued to rise.
Moreover, the targets set by the Finance Ministry for senior banking officials are stringent too, and difficult to meet, said the report. "Even without AQR, the targets set by the finance ministry were very unrealistic," the report quoted a PSU bank chief who did not want to be identified.
In the past, banks would set targets for themselves on parameters listed by the finance ministry.