Review of Fixed Remuneration granted to Non-Executive Directors (NEDs)

Summary:

The Reserve Bank of India (RBI) has issued a circular (RBI/2023-24/121) on February 9, 2024, reviewing the fixed remuneration granted to Non-Executive Directors (NEDs) of Private Sector Banks, Small Finance Banks (SFBs), and Payment Banks (PBs). The circular revises the remuneration ceiling for NEDs, other than the Chair of the Board, from u20b920 lakh per annum to u20b930 lakh per annum. Banks are required to have suitable criteria for granting fixed remuneration to their NEDs, with the approval of their Board, and make annual disclosures on remuneration paid to directors. The circular comes into effect immediately and supersedes the previous circular on Guidelines on Compensation of Non-executive Directors of Private Sector Banks issued in 2015.