In March this year, China Merchants Bank disclosed for the first time in its 2022 annual report that a total of 2,876 employees of the bank were reclaimed to deduct performance pay last year. According to its latest announcement, the process of recourse to clawback of performance-based pay seems to have been completed.
On the evening of the 28th, China Merchants Bank announced in the announcement that the bank held a meeting by written summons on December 28 and deliberated and passed the "Proposal on the Recourse and Clawback of China Merchants Bank's 2022 Performance Compensation".
According to its 2022 annual report, during the reporting period, there were 2,876 employees who implemented performance pay recourse and clawback, with a total amount of 58.24 million yuan and an average salary refund of 2030,000 yuan. According to the total number of employees of the bank last year 11Calculated from 30,000 people, the number of employees who are required to "retire their salaries" accounts for more than 25%。
A person close to China Merchants Bank responded that according to the latest requirements of supervision, the board of directors and supervisors of banking and insurance institutions will review the company's performance pay recourse and clawback at least once a year, and make an announcement accordingly, which is a normal management work, not some so-called "salary bargaining" and "salary refund", let alone affecting the operating conditions of banking and insurance institutions.
CMB has also set aside a salary risk reserve from the annual remuneration that should be allocated to the bank's employees, and the allocation of the remuneration risk reserve for its relevant personnel will be restricted in the event of a significant decline in asset quality, a significant deterioration in risk status and profitability, the occurrence of a large case, or serious violations detected by the regulatory authorities.
In August last year, the Ministry of Finance issued the "Notice on Further Strengthening the Financial Management of State-owned Financial Enterprises", which clearly stated that for senior managers of financial enterprises and employees in positions with direct or important impact on risks, the basic salary is generally not higher than 35% of the total salary, and the performance pay is deferred according to the phased assessment of the business income and risk for which they are responsible, and 40% of the performance pay is The above should adopt the method of deferred payment, and the deferred payment period shall generally not be less than 3 years, so as to ensure that the payment period of performance-based remuneration matches the risk duration of the corresponding business.
In addition, according to Tiantian Finance, in March, the relevant person in charge of the former China Banking and Insurance Regulatory Commission said that after the issuance of the "Guiding Opinions on Establishing and Improving the Recourse and Clawback Mechanism for Performance Compensation of Banking and Insurance Institutions", on-site inspection and evaluation of salary deferred payment will be carried out. As of March this year, more than 95% of institutions have developed and implemented performance-based pay deferred payment and recourse clawback systems.
In other words, it is not unique for banks to seek clawbacks for performance-based pay.
For example, Bohai Bank, which is listed on the Hong Kong stock market, had 370 people with a total of 17.6 million yuan in performance pay recourse last year, with an average of nearly 50,000 yuan per person. Jiujiang Bank, which is also listed on the Hong Kong stock market, also disclosed that the amount of performance recourse rebates during the reporting period was 1.63 million yuan, but the report did not disclose the specific number. Jiangxi Bank disclosed the specific reasons for the retracement, stating that the personnel responsible for the formation of non-performing assets will be determined according to the size of the principal of the non-performing liability, and the corresponding performance remuneration will be reclaimed.
The China Banking and Insurance Regulatory Commission issued a document in March this year revealing that during the merger and reorganization of five urban commercial banks in Shanxi, 61 senior executives and key positions were retained 33.59 million yuan in performance compensation.
A city commercial bank in Zhejiang said that most banks have implemented performance pay deferred payment in key positions many years ago, and the recourse clawback system has been promoted in the near future, combined with the internal punishment system, last year, the general manager of the business department was deducted 80% of the performance, and the bank will set up a recovery team for the cadres who have left the bank to specifically pursue performance.
Judging from the 2022 annual reports of domestic listed banks, a "recourse clawback mechanism" has appeared in the annual reports of many banks, including state-owned banks such as Postal Savings Bank, joint-stock commercial banks such as China Everbright Bank and China CITIC Bank, and local banks such as Bank of Beijing, Bank of Qingdao and Bank of Zhengzhou.
Since 2015, the banking industry has officially implemented a "salary limit order", what has been the change in the salary of bank executives in recent years?
In mid-October this year, the China Listed Banks Analysis Report 2023, released by the China Banking Association, specifically studied the remuneration of directors and executives of listed banks.
Let's start with the executives. From 2018 to 2022, the order of the average remuneration of senior executives of various listed banks remained basically unchanged, that is, joint-stock banks were the highest, urban commercial banks and rural commercial banks occupied the second and third places respectively, and large banks were the lowest.
Specifically, the average remuneration of senior executives of domestic listed banks in 2022 is 145560,000 yuan, compared to 150 in the previous year020,000 yuan decreased by 297%。The average executive compensation of a large bank is 99670,000 yuan, up from 89 in the previous year540,000 yuan, an increase of 1131%；The average remuneration of senior executives of joint-stock banks, urban commercial banks and rural commercial banks all showed a downward trend, with year-on-year declines respectively. 12% and 655%。
Let's look at the executive directors. From 2018 to 2022, the average remuneration of executive directors of joint-stock banks has always been the highest among all types of banks, the average remuneration of urban commercial banks and rural commercial banks ranked second and third respectively, and the average remuneration of executive directors of large banks has always been the lowest among all types of banks.
Specifically, the average total remuneration of executive directors of listed banks in 2022 was 152320,000 yuan, down 375%；The remuneration of executive directors of large banks and joint-stock banks increased respectively. 47%；The remuneration of executive directors of urban commercial banks and rural commercial banks showed a downward trend, falling by 7 respectively48% and 993%。
As of the end of 2022, 57 of the 58 listed banks that have disclosed their annual reports did not implement any equity incentive plans, employee stock ownership plans and other employee incentive measures during the reporting period.
According to other public data, in the first half of this year, the total remuneration of 42 listed banks was 4,6615.7 billion yuan, an increase of 337%, an increase of almost half compared to the first half of 2022.
Among the state-owned banks and joint-stock banks, Industrial Bank replaced China Merchants Bank as the bank with the highest growth rate in total remuneration in the first half of the year, with a year-on-year increase of 754%, while China Merchants Bank's total compensation increased by only 499%。
In addition, Bank of China's total compensation increased by 5% year-on-year28%, the largest increase among the six major banks;ICBC grew by only 118%, which is at the bottom of the six rows. Ping An Bank, which had a negative growth in total salary in the first half of last year, only slightly increased by 038%。
It is worth noting that among the 42 listed banks, 8 listed banks have negative year-on-year growth in total remuneration, including Huaxia Bank, Shanghai Pudong Development Bank and China Everbright Bank.
In addition, among the 42 listed banks, 17 banks had a negative increase in per capita salary in the first half of the year, an increase of 6 compared with 11 in the same period last year. Among them, China Merchants Bank cut salaries again, with an average salary of 32 in the first half of the year170,000 yuan, down 2 percent year-on-year44%, which is equivalent to a monthly salary of 5360,000 yuan, but still ranks first in the salary list.
Overall, the average half-year salary of the 42 listed banks this year is about 18590,000 yuan, equivalent to an average monthly salary of 310,000, almost the same as the same period last year.