IDBI Bank seeks shareholders’ nod for 10-fold hike in MD & CEO salary

Private lender IDBI Bank has proposed a nearly 10-fold hike in the salary of its managing director and CEO Rakesh Sharma who had been instrumental in bringing the bank out of the RBI's restrictive prompt corrective action (PCA) framework.

The bank has sought the approval of its shareholders through a postal ballot which started on April 6 and will end on May 5, 2022, to pass the ordinary resolution, among others. The lender, in which LIC holds a majority stake, will declare the results of the postal ballot on or before May 7, 2022.

Members' permission is also sought to re-appoint Sharma as the MD & CEO for another three years with effect from March 19, 2022.

The bank proposes for approval of the members to transact special business through postal ballot only by way of voting through electronic means, to consider and, if thought fit, to pass as ordinary resolution for re-appointment of Rakesh Sharma as a non-rotational director and Managing Director & Chief Executive Officer (MD&CEO) for a period of three years with effect from March 19, 2022, the bank said in a regulatory filing.

The Reserve Bank approved Sharma's re-appointment in mid-February.

"...pursuant to the recommendation of the NRC and the board of directors of the bank, approval of the members of the bank, be and is hereby accorded to the payment of remuneration by way of salary, allowances and perquisites to Rakesh Sharma, as the MD&CEO of the bank with effect from March 19, 2022, up to Rs 2,40,00,000 approximately for FY2022-23, to be approved by the RBI," IDBI Bank said in the filing.

The perquisites involve the facility of semi-furnished accommodation, club membership, car for official purpose, entertainment expenses, payment of income-tax on perquisites by the bank to the extent permissible, medical reimbursement, leave and leave fare concession, gratuity, retirement benefits among others.

Any revision, in salary and perquisites shall be recommended by the Nomination & Remuneration Committee (NRC) and board and subject to RBI approval, the bank said.