Kotak Mahindra Bank has announced that it will cut 10 per cent of CTC for employees earning above Rs 25 lakh per annum. The bank said in an internal mail that the cut will be effective from May and that employees earning less than Rs 25 lakh per annum will not be impacted.
"We have decided on a 10 per cent reduction in CTC for all colleagues with a salary of more than Rs 25 Lakh per annum, with effect from May 2020 for FY21. Employees earning less than Rs 25 lakh p.a. will not be impacted," stated the internal mail, as mentioned in a report in Moneycontrol.
Kotak Mahindra Bank said that coronavirus is wreaking havoc on the economy, in turn impacting financial firms. It said that it is imperative to review the bank's costs and operations in advance to ensure sustainability. "We need to ensure that our colleagues are safe and do our best to protect their jobs," the email said.
The lender said that what seemed to be a 2-3 months' phenomenon in the beginning has snowballed into a pandemic with serious repercussions on lives and livelihood. "More importantly, it is increasingly clear that the pandemic is not going away anytime soon. Entire mankind is praying and hoping for quick discovery of a vaccine and antidote," it said.
In April, the leadership of the bank had taken pay cuts, while Uday Kotak decided to forego his annual salary. "Kotak Mahindra Bank today announced that the group's leadership team has unanimously and voluntarily opted to take a 15 per cent cut in compensation for the financial year 2020-21. Uday Kotak has personally opted to forgo his salary, and will receive Re 1," the bank had said in a release.
Shares of Kotak Mahindra Bank were trading at Rs 1,184.65, falling 4.88 per cent apiece on BSE on Thursday.
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