Bank directors want to cut employee salaries, all expansions, but not their dividends
Directors of banks want to cut salaries and all types of bonuses for almost all employees, stop fresh recruitment, expansions and donation for 18 months.
But they want to keep their spending on IT-related services, which goes against the spirit of this time of pandemic and the months to come.
They put 13 conditions, including "limiting all other expenditures" as the last clause. But they did not say anything about taking dividends, a tendency that hurts many executives.
Secretary-General of Bangladesh Association of Banks (BAB), a forum of private banks' directors, sent a letter to its chairman and all 36 member banks, asking them that these measures can be implemented from July 1, 2020 up to December 31, 2021.
The Business Standard has obtained a copy of the letter that showed 13 reasons that prompted them to cut 15 percent salaries of employees who get minimum Tk40,000 a month as starting salary.
New employees in many banks under probation period get Tk40,000 or more. So, if the decision is taken, it will affect almost all employees.
The BAB said investments have declined significantly, interest income has come down, recovery is almost nil, and there has been a decrease in export, import and remittance. So banks' incomes have been affected seriously.
A few banks have already announced a cut in salaries of their employees.