PSU banks fall as strike called off

PSU Banks are not having a particularly good day today. Bank of Baroda, Bank of India, Allahabad Bank, PNB, Corp Bank, Syndicate Bank, Canara Bank, Dena Bank, Union Bank of India and Bank of Maharashtra.

This disenchantment for the PSU banks increased today – not because the bankers union withdrew the strike call  but because this call back was on account of the agreement struck with the Indian Banks’ Association for a 14% wage hike and payment of arrears will begin from November 2012. This is expected to hike the costs for the banks which are already reeling under mounting NPA pressures and lower profitability. This wage hike will result in an increased outgo of Rs 4,724 crore for banks. Also what this will lead to is an increased payout to pensioners.

This apart, the banks will now be closed alternate Saturday and will work full time on all other days.