 "Pay package of IDFC's Rajiv Lall sees decline of 26% in FY15")
The pay package of soon-to-be banker Rajiv Lall, executive chairman of infrastructure finance company IDFC, declined by 26 per cent in the last financial year. In 2014-15, Lall earned a remuneration of Rs 4.40 crore compared with Rs 5.55 crore in 2013-14 on account of a sharp decline in performance-linked incentives.
Lall, is not the only one who has taken a hit in the total pay. According to the annual report for FY15, Managing Director & Chief Executive Officer Vikram Limaye also saw his pay package come down by 24 per cent. Limaye’s remuneration last financial year was Rs 3.91 crore, compared with Rs 4.86 crore in 2013-14.
For both, the salary and perquisite component increased but performance-linked incentives saw a decline. Lall’s variable component of the pay declined by Rs 1.45 crore in FY15, compared with last year whereas Limaye’s performance-linked incentive component was down by Rs 1.15 crore.
This was expected considering the annual net profit for IDFC for the year ended March 2015 declined five per cent to Rs 1,707 crore from Rs 1,803 crore in FY14. The net interest income also reduced by four per cent to Rs 642 crore. In the same time, its gross loan book decreased by eight per cent to Rs 54,745 crore at the end of March 2015 from Rs 59,829 crore a year ago. The gross disbursement and approvals also declined in FY15. The company’s performance has been under pressure for the last two years on account of slow growth and lack of activity in the infrastructure sector.
In the annual report, Lall said that despite an improvement in the macroeconomic environment, challenges pertaining to infrastructure still remain. However, he added that going ahead the situation may improve.
“We are hopeful that a combination of a more benign macroeconomic situation, lower interest rates, sector specific policy measures and greater targeted public spending on infrastructure will begin to yield positive results in the coming year. Such a resurgence in economic activity would be a great boost for IDFC’s new banking initiative,” said Lall in the annual report for 2014-15.
The cut in the pay package comes ahead of IDFC starting its banking operations this year. It received in-principle approval from the Reserve Bank of India in 2014 to launch a bank and is set to start full-fledged banking operations in October this year.
“Accordingly, IDFC Bank Limited ('IDFC Bank') was incorporated on October 21, 2014. We expect to commence banking operations in October 2015… We intend to build a successful bank with the same dedication and passion that we have shown in the past without losing our long term perspective,” Lall said in the annual report.
Lall, is not the only one who has taken a hit in the total pay. According to the annual report for FY15, Managing Director & Chief Executive Officer Vikram Limaye also saw his pay package come down by 24 per cent. Limaye’s remuneration last financial year was Rs 3.91 crore, compared with Rs 4.86 crore in 2013-14.
For both, the salary and perquisite component increased but performance-linked incentives saw a decline. Lall’s variable component of the pay declined by Rs 1.45 crore in FY15, compared with last year whereas Limaye’s performance-linked incentive component was down by Rs 1.15 crore.
This was expected considering the annual net profit for IDFC for the year ended March 2015 declined five per cent to Rs 1,707 crore from Rs 1,803 crore in FY14. The net interest income also reduced by four per cent to Rs 642 crore. In the same time, its gross loan book decreased by eight per cent to Rs 54,745 crore at the end of March 2015 from Rs 59,829 crore a year ago. The gross disbursement and approvals also declined in FY15. The company’s performance has been under pressure for the last two years on account of slow growth and lack of activity in the infrastructure sector.
In the annual report, Lall said that despite an improvement in the macroeconomic environment, challenges pertaining to infrastructure still remain. However, he added that going ahead the situation may improve.
“We are hopeful that a combination of a more benign macroeconomic situation, lower interest rates, sector specific policy measures and greater targeted public spending on infrastructure will begin to yield positive results in the coming year. Such a resurgence in economic activity would be a great boost for IDFC’s new banking initiative,” said Lall in the annual report for 2014-15.
The cut in the pay package comes ahead of IDFC starting its banking operations this year. It received in-principle approval from the Reserve Bank of India in 2014 to launch a bank and is set to start full-fledged banking operations in October this year.
“Accordingly, IDFC Bank Limited ('IDFC Bank') was incorporated on October 21, 2014. We expect to commence banking operations in October 2015… We intend to build a successful bank with the same dedication and passion that we have shown in the past without losing our long term perspective,” Lall said in the annual report.