Thursday, March 11, 2010
Well, it's about time they started reining in those banking bonuses in China and it couldn't come at a better time after more than a trillion dollars in new lending last year and recent concerns that credit markets have become overheated.
An AP report in the Miami Herald details just how out-of-control the situation had become and what drastic steps are being taken by the Chinese government.
China has tightened controls on pay for its top bankers, joining global efforts to try to limit financial risks by linking longer-term performance more closely to compensation.The Wall Street Journal also ran a story($) on this today in which, for the print edition, they had the pictures of the six top banking CEOs atop each of their names, titles, and 2008 pay.
China's top bankers are paid modestly by Western standards but receive many times the salary of the average Chinese worker, which has fueled public anger. Top banking and insurance executives are appointed by the ruling Communist Party.
The chairman of China's biggest commercial lender, Industrial & Commercial Bank of China Ltd. was paid 1.6 million yuan ($235,000) in 2008, while Citigroup CEO Vikram Pandit received $38.2 million that year.
With compensation ranging from $220,761 for Xiao Gang, Chairman of the Bank of China, to $235,849 for Jiang Jianging, Chairman of ICBC as noted above, for a second there, I thought I was reading The Onion.