The largest lender of the country State Bank of India (SBI) is likely to pay its 2.5 lakh employees’ salary of 15 days’ as performance-linked incentive for the previous fiscal. This is because the lender reported 41 per cent jump in its standalone net profit for FY21 at Rs 20,110.17 crore.
As per the agreement, signed with the Indian Banks’ Association (IBA) in November 2020, public sector banks and some other banks have accepted the concept of performance-linked incentive.
According to the Times Now report, if a PSU lender reports a 5-10 per cent increase in its operating profit then its employees will get 5 days' salary (basic plus DA) as incentive.
This incentive will be to 10 days' salary if operating profit is up by 10-15 per cent and 15 days' salary if operating profit is more than 15 per cent. But in each of these cases, the bank must have positive net profit. If profit rises by less than 5 per cent, then no incentive will be paid to employees.
According to a report in the Times of India, Canara Bank and Bank of Maharashtra have already paid their employees performance-linked incentive. Canara Bank also paid out a performance-linked incentive equivalent to 15 days’ pay.