New labour Codes raise operating expenses of pvt banks, insurers

The new labour Codes, notified by the central government in November 2025, have pushed up employee costs for private-sector banks and insurance companies, with these firms reporting higher operating expenses in the October-December quarter (Q3FY26) due to the statutory impact of the new labour Codes.

- AATHIRA VARIER

HDFC Bank, the country's largest private sector lender, reported operating expenses of ₹18,770 crore in Q3FY26, compared to ₹17,110 crore in Q2FY26.

"The bank has recognised an estimated incremental impact of ₹800.00 crore under 'Employees cost' in the profit & loss account during the quarter and nine months ended December 31, 2025, considering best information available. The bank continues to monitor the finalisation of Central and State Rules and clarifications from the government on the new labour Codes, and would provide appropriate accounting effects on the basis of such developments, as needed," HDFC Bank said in its exchange filing.