The finance ministry has urged the Indian Banks’ Association (IBA) to complete the wage revision process for public sector bank (PSU bank) employees by December 1, 2023. The previous wage agreement for PSU bank employees lapsed on November 1, 2022, and discussions for a new agreement have been in progress between the IBA and the unions representing the employees.
In a letter to the IBA, the finance ministry expressed its commitment to safeguarding the interests of bank employees and expressed confidence in the IBA and unions reaching an early and amicable settlement. Officials believe that an early wage increase would enhance working conditions and provide incentives for staff in the banking sector.
Additionally, the ministry of finance has urged the IBA to ensure that all future salary discussions are concluded before the next period begins to enable the timely implementation of wage revisions. Factors like financial health of the banks, living cost, and salaries in other sectors makes the wage revision process for PSU bank employees more complex.
The IBA has expressed its commitment to achieving a fair agreement that benefits both the banks and employees, while the unions remain hopeful for a satisfactory wage increase.
This development coincides with the positive financial performance of Public Sector Banks, with net earnings nearly tripling to Rs 1.04 lakh crore in FY’23, compared to Rs 36,270 crore in FY’14.
There is also an increase in return on assets (ROA) in PSBs which increased from 0.51 percent in FY14 to 0.78 percent in FY23, while net interest margin (NIM) rose from 2.73 percent to 3.23 percent in FY23.
