A study of 21 large banks in the country has found that foreign banks, led by Citi India, have the highest employee cost and HDFC has the lowest, with the state-run lenders in the middle.
According to the Boston Consulting Group (BCG), Citi India leads the pack of salary cost in relation to the asset base with the average cost being Rs 19 lakh as of last financial year, followed by Standard Chartered (StanChart) at Rs 13 lakh and HSBC at Rs 12.3 lakh.
But what is to be noted here is that Citi India also makes its employees pay back the most, with its average revenue per employee at Rs 127 lakh, way above State Bank of India’s (SBI) average revenue of Rs 20 lakh per employee.
At the fourth slot is the mid-sized public sector bank (PSB) Indian Overseas Bank (IOB) with an average salary cost of Rs 6.5 lakh per employee, thereby making it at the top of the PSBs.
Against this, the largest lender SBI, a notch down at Rs 6.4 lakh per employee while the new-age state-run IDBI Bank and Oriental Bank of Commerce (OBC) cough up Rs 6.3 lakh each on every employee on an average.
While banking behemoth SBI had over 200,000 employees as of last financial year, Citi India has just about 7,500, and Chennai-based IOB has about 30,000. State Bank employees together generated Rs 1,33,851 crore in revenues with a profit of Rs 11,733 crore in the past financial year.
Similarly, IOB also has the largest cost to income ratio among these banks, at 67 per cent, while Citi has one of the lowest at 24 per cent, topped by HSBC at 23 per cent. For SBI, this stands at 51 per cent, says the BCG study.
The largest private sector lender spends an average of Rs 5.5 lakh on its every employee, while Indian Bank spends Rs 6.2 lakh, Bank of Baroda (BoB): Rs 6 lakh, Axis Bank and Bank of India (BoI): Rs 5.8 lakh each, Punjab National Bank (PNB): Rs 5.5 lakh, Canara: Rs 5.1 lakh, Union Bank of India (UBI): Rs 4.9 lakh, Syndicate Bank, Allahabad Bank and Corporation Bank: Rs 4.8 lakh each, Uco Bank: Rs 4.5 lakh and Central Bank spends Rs 4.4 lakh each on its employees.
When it comes to cost to income ratio of other banks, Central Bank is at the second slot with 52 per cent, followed by Syndicate Bank at 51 per cent, HDFC Bank at 49 per cent, Uco at 48 per cent, BoI: 44 per cent, BoB: 42 per cent, Axis and OBC: 41 per cent each, UBI: and IDBI Bank: 40 per cent each, PNB and Canara: 39 per cent each, Indian Bank and ICICI Bank: 38 per cent each, Corp Bank: 37 per cent, Allahabad Bank: 36 per cent and StanChart: 30 per cent.