Bank employees' 15% wage hike may not be a costly affair for lenders

The hike in pay slip cost does not factor in superannuation and pension costs, along with performance linked incentives

The wage negotiation agreed upon by bank unions and managements may not have a significant impact on the balance sheets of the lenders in near future.

On Wednesday, the Indian Banks’ Association (IBA), representing the management of 35 banks, and United Forum of Bank Unions, representing close to a million workers and officers, signed a memorandum of understanding (MoU) to go for a 15 per cent hike in the existing wage bill. While this will be effective from November 2017 till October 2022, a first-of-its-kind performance-linked incentive (PLI) for state-owned banks will be implemented from the present financial year.

The wage bill