News digest: Hiring back on track, merger of banks, Infosys case, and more

1. Corporate salary bill hints at hiring uptick after a lull of nearly 3 years 

After a lull of nearly three years, corporate India seems to be back on a hiring spree. The combined salary and wages bill for listed companies was up 12.6 per cent year-on-year (YoY) during the April-June quarter, growing at the fastest pace in nearly four years. In comparison, the salary bill was up 8.7 per cent last financial year, and 10 per cent in 2016-17.

The buoyancy in salary and wages is, however, muted compared to other cost heads and overall growth in these companies’ top line. For example, the companies’ combined revenues grew 16.3 per cent during the first quarter of 2018-19, while their raw material costs were up 20.7 per cent and overall operating (or variable) costs rose 16.7 per cent. Read more…

2. Sebi makes mutual fund investing cheaper, caps expense ratio to 1.05%

The Securities and Exchange Board of India (Sebi) on Tuesday announced major changes to the fee structure for the Rs 25-trillion mutual fund (MF) industry, a decision that will hit the profits of asset management companies (AMCs) but result in savings for investors.

The regulator has capped the so-called total expense ratio (TER) for fund houses with equity assets up to Rs 500 billion at 1.05 per cent, down from as much as 1.75 per cent charged earlier. Read more...

3. Infosys loses arbitration case against Rajiv Bansal over severance package

Infosys, the country’s second-largest information technology services firm, has lost an arbitration battle against its former chief financial officer Rajiv Bansal over his severance package.

The arbitration tribunal has directed the IT firm to pay Bansal the pending amount of Rs 121.70 million with interest. Infosys’s counterclaim for refunding the previously paid severance amount of Rs 52 million has also been rejected. Read more...

4. Merger of BoB, Dena, Vijaya Bank may bring in savings worth Rs 10 billion

The proposed rationalisation of Bank of Baroda (BoB), Vijaya Bank and Dena Bank’s branches is expected to bring savings of Rs 10-12 billion annually, an official said.

 BoB and Dena Bank have branches in the same vicinity and need rationalisation in nearly 1,000 locations. The rationalisation of branches will lead to a reduction in manpower, a Dena Bank executive said. However, there will not be any job loss. Some employees might be transferred to other branches or utilised at new branches, he said.

Dena Bank has over 1,800 branches in Gujarat, Maharashtra and Chhattisgarh. Read more...