Mumbai, Sept. 4 -- If you thought public sector banks (PSBs) don't pay well, think again. India's state-owned lenders are better paymasters than their private peers, with average salaries at banks including State Bank of India (SBI) and Bank of Baroda far higher than those at ICICI Bank and HDFC Bank, a Mint analysis of data from annual reports showed. However, the chiefs of private banks as well as their senior management staff continue to earn much more than their PSB counterparts. The average salary at HDFC Bank and ICICI Bank, the largest private lenders, stood at Rs.11.14 lakh and Rs.13 lakh, respectively, in fiscal year 2025 (FY25). In contrast, the average salary at SBI was Rs.27.2 lakh and at Bank of Baroda it was Rs.22.1 lakh. The average salary was derived by dividing the aggregate employee expenses in the financial year by the number of employees at the end of the year. This means that employees who left before end-March are not accounted for in the year-end total. The analysis covered data from 10 PSBs and 10 private sector banks from FY23 to FY25. The gap, experts said, is primarily on account of higher salaries at the lower levels of PSBs, with lower hikes than the private sector as one climbs the ladder. The gap in salaries widens sharply at the leadership level. HDFC Bank's managing director and chief executive officer (CEO) drew Rs.12.06 crore in FY25, while ICICI Bank's CEO earned Rs.10.45 crore. In comparison, Bank of Baroda's CEO took home Rs.73.92 lakh and the chairman of SBI received Rs.63.87 lakh, the annual report shows. Experts said the difference stems mainly from how compensation structures are designed in public and private sector banks. "Public sector banks tend to pay more at junior management levels and private sector banks tend to pay more at senior management levels," said Dinkar Pawan, a director at Deloitte India. "In private banks, pay is shaped by talent market forces, whereas in PSBs it is determined by pre-agreed pay scales." Private sector banks need a larger number of people for entry-level jobs than public sector banks; therefore, private sector banks have lower salaries at those levels. He said the gap exists at both junior and senior levels but becomes especially sharp at the top. While SBI is the largest Indian lender by assets, HDFC Bank is the largest private sector bank. "In private banks, pay increases with experience and seniority, not just in terms of fixed compensation but also in terms of bonuses and employee stock options. This is particularly true at the top management, where the disparity becomes even more pronounced. It must be noted, however, that the benefits offered by PSBs tend to be significantly better compared to private banks," said Pawan. Others said that the median salary-the mid-point in the data when all salaries are stacked in order-also reflects this divergence. The median salary-except for board members and key managerial personnel-at HDFC Bank was Rs.5.6 lakh for male employees and Rs.3.9 lakh for female employees. In comparison, SBI's median employee salary was Rs.13.9 lakh and Rs.12.8 lakh for male and female staff, respectively....