CEO pay at PSU banks rose to Rs 74 lakh in FY25 amid leadership shuffle

Executive compensation at India's public sector lenders has witnessed a notable rise in fiscal year 2025, coinciding with leadership reshuffles at key banking institutions, including State Bank of India, Indian Bank, and Canara Bank, over the past 24 months.

Despite the hikes in remuneration, a public lender CEO earns only about 5-7 percent of the salary drawn by their private sector counterparts.

The increase in pay packages aligns with improved performance metrics. Public sector banks reported a record net profit of Rs 1.78 lakh crore in FY2024-25, while net non-performing assets fell to a multi-year low of 0.52 percent. At the annual review meeting last month, Union Finance Minister Nirmala Sitharaman lauded the strong financial performances of the Public Sector lenders (PSBs), noting their total business rose from Rs 203 lakh crore in FY2022-23 to Rs 251 lakh crore in FY2024-25.

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'Salary jumps of top bankers'

The incumbent Chairman of the country's largest public lender, the State Bank of India, drew an annual compensation of Rs 63.87 lakh in FY2025. The remuneration of SBI Chairman Challa Sreenivasulu Setty, or CS Setty, included a basic salary of Rs 26.97 lakh, Dearness Allowance of Rs 14.36 lakh, and other components of Rs 22.54 lakh respectively.

Setty was appointed as the chairman of SBI on 28 August 2024, following the retirement of former SBI Chairman Dinesh Khara from the board on 27 August. Khara's total remuneration for FY25 was recorded as Rs 43.87 lakh, with a basic salary of Rs 10.95 lakh.

A spike was also seen in the annual remuneration of the bank's four Managing Directors-- Ashwin Kumar Tewari, Vinay M Tonse, Rana Ashutosh Kumar Singh, and Rama Mohan Rao Amara in FY25.

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Kumar, who is the MD of SBI's Corporate Banking and Subsidiaries, received an annual remuneration of Rs 63.40 lakh, while Tonse, MD of Retail business and Operations, received a salary package that stood at Rs 49.12 lakh.

Rana Ashutosh Kumar, who is MD of SBI's Risk, Compliance and SAARG, drew an annual pay package of Rs 26.80 lakh, while Amara, MD of International Banking, Global Markets & Technology) received an annual pay package of Rs 11.85 lakh during fiscal 2025.

According to the annual report of the public lender, the media remuneration of the key managerial personnel, including the CEO, was Rs 61.37 lakh in FY2025, while that of employees was Rs 13.90 lakh. The total workforce of SBI stood at 2,36,226, of which 65,148 were women as of March 31, 2025.

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Another public sector bank, Indian Bank, saw a major leadership change in FY2025, along with a hike in remuneration. Binod Kumar, who was appointed as the bank's Chairman, MD, and CEO in January 2025, received a paycheck of Rs 8.67 lakh, while ex-MD and EO, SL Jain's, salary package stood at Rs 84.38 lakh. Jain's remuneration included the basic pay of Rs 20 lakh, Dearness Allowance (DA) of Rs 10.20 lakh, arrears of Rs 46,344, incentives of Rs 51.71 lakh, and PF and NPS contribution of Rs 2 lakh, respectively.

Public lender Canara Bank, which is on a hunt for a new CEO as the tenure of incumbent MD & CEO K Satyanarayana Raju is set to end on 31 December 2025, disbursed him the remuneration of Rs 63.48 lakh, including basic salary of Rs 42.41 lakh and PLI of Rs 21.07 lakh, respectively. Raju's remuneration witnessed a 50 percent hike year-on-year. In fiscal year 2024, Raju's pay package stood at Rs 42.23 lakh as per the lender's annual report.

Bank of Maharashtra's Nidhu Saxena, who was appointed as MD & CEO on March 27, 2024, received a remuneration of Rs 37.81 lakh in fiscal year 2025. However, his predecessor, AS Rajeev's compensation was 21% higher at Rs 47.81 lakh, including PLI amount.

Bank of Baroda's MD and CEO, Debodatta Chand, compensation rose by 26 percent in FY25 year-on-year. Datta's FY25 remuneration stood at Rs 73.92 lakh compared to Rs 58.70 lakh in the year-ago period. Datta's overall remuneration included a basic salary of Rs 41.26 lakh, performance-linked incentives of Rs 21.37 lakh, other prerequisites, and reimbursements. In the previous fiscal year 2024, Chand received a compensation of Rs 41.38 lakh, including PLI of Rs 4 lakh. Chand assumed charges as MD and CEO of the bank in July 2023. Former CEO Sanjiv Chadha retired on 30 June 2023, drawing a compensation of Rs 12.62 lakh in FY24.

'C-Suite salary in private banks'

Among the top private lenders in the country, the HDFC Bank paid a compensation to its CEO, Sashidhar Jagdishan, of Rs 12.08 crore in FY25--nearly a 12 percent hike year-on-year. The basic salary accounted for Rs 3.03 crore, while allowances and prerequisites accounted for Rs 3.46 crore. He was also awarded a bonus of Rs 4.67 crore while the lender granted him 2,12,052 employee stock options during the year.

Axis Bank paid remuneration of Rs 9.11 crore during fiscal 2025 to Managing Director and CEO Amitabh Chaudhry. His basic salary accounted for Rs 5.05 crore, while Retiral/superannuation benefits stood at Rs 1.53 crore.

Kotak Mahindra Bank's CEO, Ashok Vaswani, received a total remuneration of Rs 12.95 crore in FY2025, with basic salary accounting for Rs 4.93 crore and variable pay of Rs 6.52 crore. He was also granted 18,580 stock options at an exercise price of Rs 2,144.90 per share, vesting over four tranches between FY26 and FY28.

ICICI Bank is yet to disclose these details.

However, as PSBs navigate evolving multiple challenges--from macroeconomic uncertainties to competition from fintech players, regulatory norms to digital frauds-- the executive compensation structure is becoming more performance-linked. While the salaries trail private-sector norms, the steady year-on-year hikes signal a shift in how public sector leadership roles are being valued in the banking industry.