Remuneration growth for executives is heavily outpacing that for rank and file staff at one of China’s biggest banks, with staff ousted for corruption amongst the chief beneficiaries.
For the past three years Bank of Communications has ranked first amongst China’s big state-owned lenders in terms of average remuneration levels, with executives benefiting the most from the lender’s payment largesse as an employer.
While in 2016 average remuneration for BoCom staff was 281,000 yuan per annum for year-on-year growth of 1.39%, senior management saw their payment levels surge by 20.22% to hit 1.657 million yuan.
China’s National Business Daily notes that for nearly a decade BoCom has implemented strong payment increases for staff, with average remuneration rising from 156,600 yuan in 2008 to over 280,000 yuan last year.
BoCom also bucks the general trend of big state-owned banks providing lower wages to workers compared to the employees of joint-stock lenders.
Senior executives see biggest remuneration growth
Director-level executive remuneration was 6.358 million yuan in 2016, for a gain of 8.4% compared to the preceding year, while senior management remuneration rose by 20.33% to hit 4.867 million yuan.
Supervisory executives enjoyed the biggest remuneration gain, with a year-on-year increase of 37.98% that pushed their earnings to 5.352 million yuan last year.
Some observers note that the pay rises offered by BoCom to its employees stand in sharp contrast to its lacklustre performance of late, with unremarkable earnings, lagging efficiency, and a provisions rate that is perilously close to the regulatory threshold.
Ample executive pay fails to stymie corruption
The generous payments offered by BoCom to its executives have failed to prevent some of them from succumbing to the lure of corrupt activities.
Over the past two years a string of corruption scandals have claimed the scalps of a number of BoCom’s top brass.
One of the senior most amongst them has been Yang Dongping, formerly BoCom’s chief risk officer and a three decade veteran of the Chinese banking sector.
In February of this year Yang was expelled from both his position and the Chinese Communist Party, and placed under investigation by the central government’s disciplinary department.
According to the authorities Yang sought to use his position to help private companies obtain loans in return for kickbacks.
BoCom’s annual report shows that Yang received a 10% pay rise last year, boosting his annual remuneration level to 526,600 yuan.