RBI defers banks' compensation norms implementation

The Reserve Bank of India (RBI) has deferred the implementation of guidelines on compensation for wholetime directors and other executives of private and foreign banks in India by a year to 2012/13, it said on Wednesday.

The guidelines had been due to be implemented in 2011/12 but the Reserve Bank of India said the move was deferred to give banks sufficient time to frame their policies. In July, the RBI has issued draft guidelines on compensation for whole time directors, chief executive officers, risk takers and control function staff of private sector and foreign banks in India. It said it was examining comments received. It has asked banks to refer to the Basel Committee on Banking Supervision's (BCBS) document on Methodologies for Risk and Performance Alignment of Remuneration, which was issued in October, and start preparatory work for formulating compensation policies.