In an irony of sorts, RBI gets to approve salaries of all the top-level bankers in the country, but the central bank's top officials themselves get less than 5 per cent of what is paid to the bank chiefs.
An analysis of salaries paid to top officials of Reserve Bank of India and of banks licensed by it to do business in the country shows that RBI Governor D Subbarao's total remuneration is less than not only the chiefs of private sector banks, but also most of the public sector lenders.
The gap is huge with salaries of some of the bank chiefs being over 20-times of what is paid to RBI's Governor, its four Deputy Governors or its seven Executive Directors.
According to the information available from RBI under the Right to Information Act, RBI Governor D Subbarao got a gross salary of Rs 1,28,500 in the month of June 2010. This corresponds to an annual package of little over Rs 15 lakh for RBI Governor, who is a signatory to all the currency notes in the country.
Subbarao is the top-paid executive at RBI, followed by the four Deputy Governors, Shyamala Gopinath, Usha Thorat, KC Chakrabarty and Subir Gokarn, who got a gross salary of Rs 1,11,500 each in the same month. This translates into annual pay of about Rs 13.4 lakh.
RBI's seven Executive Directors were paid Rs 90,271 each in June 2010 -- the latest month for which salary data was available -- giving an annual package of less than Rs 11 lakh.
In comparison, at least 14 top executives at various private sector banks got an annual remuneration of more than Rs one crore in the last fiscal ended March 31, 2010.
Among the public sector banks also, at least ten top executives of various banks including the State Bank of India Chairman OP Bhatt's salary is higher than that of Subbarao.
Bhatt's total remuneration in the fiscal 2009-10 stood at nearly Rs 26.5 lakh.
However, it is the private sector banks who pay the most to their top executives. The pay packages of their top executives exceed by a large margin pay packages of their public sector peers as also RBI's top officials.
HDFC Bank Managing Director Aditya Puri earned Rs 3.40 crore in 2009-10 while ICICI Bank MD and CEO Chanda Kochhar's pay package stood at Rs 2.08 crore during that fiscal.
The government fixes the remuneration for key executives of public sector banks, as also that of RBI's top officials. On the other hand, private banks need a clearance from RBI for salary of their top executives, but currently there is no cap.
RBI in July suggested slashing salaries of CEOs and directors of private banks on poor showing and limiting the annual pay hikes to 10-15 per cent. At around the same time, a panel set up by Finance Ministry had recommended better salaries for public sector bank chiefs.