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Indian Banks' Association proposes new wage hike formula to bank unions

Bank unions have opposed the proposal of linking pay to performance

Indian Banks’ Association proposes new wage hike formula to bank unions
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The operational guidelines also take care of third-party and exclusive collateral held by a bank

Namrata Acharya Kolkata
Indian Banks’ Association (IBA) has proposed a new wage hike formula to bank unions. Under the proposal, while the fixed hike is set at 6 per cent, the variable component will be based on the grading of banks in three categories: A, B and C. 

The performance linked-compensation part will be computed annually based on the financial results of the bank. The two parameters proposed to be used for computing the variable-linked pay would be -- operational profits and return on assets. 

Thus for FY 2017-18, in terms of both the parameters, only two banks — Indian Bank and Vijaya Bank, qualify

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