RBI proposes clipping financial wings of banking sector heads | Editorji
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RBI proposes clipping financial wings of banking sector heads

Feb 26, 2019 18:51 IST

In a discussion paper, The RBI has proposed important changes in the way directors and CEOs of private and foreign banks are compensated.The Reserve Bank has suggested that at least 50 per cent of compensation should be variable. The variable pay, including ESOPs should be capped at 200% of the fixed pay. Also, a provision for penalty or a claw-back should be put in place in case of bad loan divergence.The Bank observed that employees were too often rewarded for increasing short-term profit

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