According to ‘A Profile of Banks 2008-09' released by the RBI, the average business and profits per employee for Indian banks more than doubled in the five years from 2004-05 to 2008-09. The improvement was due to business growth outpacing that in manpower. Indian banks registered a total business (advances plus deposits) growth of 135 per cent from 2004-05 to 2008-09, while their employee strength edged up only by 10 per cent. Their branch network grew by 21 per cent.
Contrary to the general perception, public sector banks' (PSB) employee productivity grew at a faster rate than that for private sector banks in this period. As of March 2009, both private banks and PSBs had average business per employee of Rs 7.44 crore. However, private banks generated higher profits/employee (Rs 6.1 lakh) with fee income forming a significant proportion of their earnings (which is outside the core business). Fee income for private listed banks contributed 25 per cent of their net revenues for FY09.
PSBs increased their branch network by 2 per cent between 2004-05 and 2008-09. However, the employee strength has fallen by 1 percentage point in spite of recruiting more than 26,000 people in 2008-09.
The decline in employee base of PSBs during this period was due to a good portion of the workforce getting superannuated and the implementation of VRS scheme in 2000 to rationalise the workforce. More than 1.26 lakh employees of 26 banks were given the VRS option.
Punjab National Bank, Canara Bank and Central Bank of India have seen their employee strength fall the most among PSBs. IDBI Bank, Corporation Bank and Oriental Bank are the top three PSBs in terms of productivity. IDBI Bank has business per employee of Rs 20 crore even as it added around 5,600 employees during 2004-09. Corporation Bank also increased its manpower by 2,200. As the PSBs' productivity doubled during this period, they caught up with its private sector peers in terms of business per employee.
Private banks increased their workforce by more than 110 per cent over the five-year period. Private banks improved their business per employee by 28 per cent. Some private banks employ direct selling agents who bring in business but don't figure on the bank's payroll; this could overstate their productivity to some extent.
The new-age private sector banks such as ICICI Bank, Axis Bank and YES Bank witnessed improvement in their employee productivity in terms of both business and profits.
HDFC Bank, Kotak Mahindra Bank and IndusInd Bank are the only banks which have witnessed decline in their productivity over the years. HDFC Bank's merger with Centurion Bank of Punjab has taken a toll on its productivity.
As productivity of bank employees shot up, so did their compensation. Even as the total employee count for Indian banks grew by 15 per cent, employees' wages grew by 85 per cent over five years.
Source: http://www.thehindubusinessline.com/2010/01/11/stories/2010011150990100.htm
PSBs increased their branch network by 2 per cent between 2004-05 and 2008-09. However, the employee strength has fallen by 1 percentage point in spite of recruiting more than 26,000 people in 2008-09.
The decline in employee base of PSBs during this period was due to a good portion of the workforce getting superannuated and the implementation of VRS scheme in 2000 to rationalise the workforce. More than 1.26 lakh employees of 26 banks were given the VRS option.
Punjab National Bank, Canara Bank and Central Bank of India have seen their employee strength fall the most among PSBs. IDBI Bank, Corporation Bank and Oriental Bank are the top three PSBs in terms of productivity. IDBI Bank has business per employee of Rs 20 crore even as it added around 5,600 employees during 2004-09. Corporation Bank also increased its manpower by 2,200. As the PSBs' productivity doubled during this period, they caught up with its private sector peers in terms of business per employee.
Private banks increased their workforce by more than 110 per cent over the five-year period. Private banks improved their business per employee by 28 per cent. Some private banks employ direct selling agents who bring in business but don't figure on the bank's payroll; this could overstate their productivity to some extent.
The new-age private sector banks such as ICICI Bank, Axis Bank and YES Bank witnessed improvement in their employee productivity in terms of both business and profits.
HDFC Bank, Kotak Mahindra Bank and IndusInd Bank are the only banks which have witnessed decline in their productivity over the years. HDFC Bank's merger with Centurion Bank of Punjab has taken a toll on its productivity.
As productivity of bank employees shot up, so did their compensation. Even as the total employee count for Indian banks grew by 15 per cent, employees' wages grew by 85 per cent over five years.
Source: http://www.thehindubusinessline.com/2010/01/11/stories/2010011150990100.htm
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Hi,
A clarification:-
Direct Selling Agents were engaged by Axis Bank (formerly UTI Bank)a long time back. This does not hold true any longer.
At present, the bank has a Sales Channel with Business Development Executives & Business Development Officers spearheading the sales efforts. BDEs/BDOs are on the permanent rolls of the bank and have a clear career path mapped out .... some of the outstanding performers have proved their mettle and are now Managers / Asst. Vice Presidents ..... the only private sector bank to have taken such a step.
Besides this, having segmented the markets with products customized for various segments, Axis Bank also has the 'Relationship Manager' stream which sources and services niche segments and is also engaged in deepening of these relationships.
In the light of the above, DSAs have become irrelevant.
A Colleague
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