RBI's proposed guidelines may trim future earnings of private bank CEOs

Chief executives officers (CEOs) of private banks might see their future earnings decreasing and face increased scrutiny, if the Reserve Bank of India’s (RBI’s) proposed rules are implemented, said experts on Tuesday.

Late on Monday night, the RBI issued a white paper, purportedly aimed at eschewing the celebrity status of bank CEOs in the private sector. The proposed guidelines said their variable pay needs to constitute at least half of the total remuneration. This would reduce the fixed component and put greater focus on performance.

The central bank has also taken measures to reduce the “risk” component of CEO remuneration by capping