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Private sector lender Yes Bank on Sunday said its leadership team has voluntarily agreed to a restructuring of their salary packages, with up to 30% of the total cost to company (CTC) for FY21 now becoming variable.

However, the bank did not specify as to what is the current level of variable pay for its leadership team.

“The covid-19 situation has exacerbated the gradually slowing growth momentum in the global economy and the revival of economy will to a great extent depend on the robustness of the financial services sector," the bank said in a statement.

It said that while the country is navigating in unchartered waters, the bank is appreciative of the leadership team for their unstinted support, “demonstrating the highest level of ownership and commitment to the bank".

The ongoing covid-19 lockdown adding to the already sluggish economic growth has led to several companies, including financial services firms, to lower staff salaries. Two private sector banks, Kotak Mahindra Bank and IDFC First Bank recently announced salary cuts. At Kotak Mahindra Bank staff salaries were cut by 10% for those earning over 25 lakh per year; its leadership team surrendered 15% of their pay for 2020-21, and Uday Kotak chose to take only a token salary for the year.

IDFC First Bank also said its senior management has volunteered to take a 10% cut in fiscal 2021 remuneration, with its chief executive officer (CEO) V Vaidyanathan taking a 30% cut in his compensation including fixed and allowances.

Meanwhile, Yes Bank reported a net profit of 2,629 crore in the three months to March 2020 as against a loss of 1,507 crore in the same period last year, owing to its income from write-down of additional tier 1 (AT1) bonds. On 13 March, the government had approved a rescue plan for Yes Bank backed by State Bank of India (SBI). Under the plan, domestic investors including SBI, Housing Development Finance Corp, ICICI Bank, Kotak Mahindra Bank, Bandhan Bank, Federal Bank and IDFC First Bank invested 10,000 crore into Yes Bank.

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