ISLAMABAD: In an extraordinary general meeting, shareholders approved a 36% increase in the gross salary of National Bank of Pakistan’s (NBP) new president, taking the amount to Rs57 million a year. However, despite the increase in gross salary, nbp’s total remuneration – which includes allowances, benefits – remains constant after he voluntarily surrendered his perks.

Despite an increase in gross salary, Ahmad’s total pay package would remain at Rs5.03 million per month or Rs60.36 million per year. Ahmad’s total remuneration would be Rs325,788 less than what former president Syed Iqbal Ashraf was getting.

The package will remain fixed till the tenure of the president, which will be shorter than the standard three-year term. Ahmad will remain president till January 1, 2019 when he attains the age of 70, which is the maximum limit for serving as president of a commercial bank.

The incumbent president has also foregone his right on two club memberships costing Rs2 million annually, furnishing annual allowance of Rs2 million, house building finance Rs5 million annually and depreciation of cars Rs9.8 million per annum.

Ahmad is a close confidant of PML-N due to his long association spanning almost over three decades. In 2014, Ahmad was appointed as deputy governor of the central bank for two years. Before being appointed deputy governor, Ahmad was running the Sage Care Homes in United Kingdom.

The new president also faces the challenge to improve affairs at the NBP, which has recently been in the news for financial scandals and infighting between regular and contractual employees.

Remuneration

The Board of Directors of the NBP had recommended a salary of Rs5.6 million per month or Rs67.2 million annually but Ahmad voluntarily opted for a package that was 15% less.

The Board observed that the NBP president’s remuneration was far less than the packages presidents of four other top peer banks have. United Bank Limited pays Rs145.6 million in annual remuneration to its president, while MCB Bank president’s remuneration is Rs89.2 million. Allied Bank Limited president’s remuneration is Rs58.2 million.

Even after the increase, the salary of the new president will be lower than his peers.

Additional perks

In addition to Rs60.2 million in annual remuneration, Ahmad would also avail NBP accommodation. However, the president has surrendered the option to avail two cars, one of 4,700 cc engine capacity and the other of 3,500 cc. The new president will also be entitled to full medical coverage and life insurance.

In case of termination, the new president would be entitled to gratuity equivalent to last-drawn monthly for each year of service.

The extraordinary general meeting also approved to increase the Board of Directors’ fee by 40% to Rs150,000 per meeting. Before the increase, non-executive directors were charging Rs90,000 per meeting.