Foreign banks to use bonus to retain talent | india | Hindustan Times
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Foreign banks to use bonus to retain talent

Performing executives engaged with the financial sector giants, especially foreign retail and investment banks, could have reasons to smile. “Pay for performance” is the new mantra, reports Mahua Venkatesh.

india Updated: Nov 28, 2008 23:48 IST
Mahua Venkatesh

Performing executives engaged with the financial sector giants, especially foreign retail and investment banks, could have reasons to smile. “Pay for performance” is the new mantra.

Though the average level of bonuses and incentives is expected to drop by 20 per cent, those who excel in performance are set to be suitably rewarded. Companies are looking for performing executives even while laying off employees. Bonuses being contemplated could be as high as 50 per cent of the pay packet.

The variable pay packages this year are likely to be between 0 and 10 per cent as against 25-40 per cent even a couple of years ago. Until now, almost all executives were entitled to bonuses and incentives.

Sumit Mehra, partner, Hunt Partners India told Hindustan Times that a sustained compensation rise year-on-year had to be brought down to reasonable levels. “We would have seen a downward trend in any case, but it may not have been as immediate as it has happened now, thanks to the global meltdown,” he said.

Arjun Srivastava, consultant, Egon Zehnder, echoed the sentiments: “Compensations will now become more realistic and this was desirable,” he said.