China’s new rules for finance pull the brakes on gravy train, bringing ‘greed is good’ era to a halt
- Finance was once China’s ‘profit machine’, but new regulations for the industry mean the era of big bonuses and lavish lifestyles is over
- Government has called for banks to abandon a Western-style ethos and adopt an outlook in line with broader economic priorities
In China’s era of breakneck growth, there were few better jobs to have than one in finance.
During those heady days – when the pursuit of money was exalted above all else – bankers’ swanky offices and hefty salaries made them the envy of the masses, a hot commodity in the marriage market and role models for the millions graduating from universities each year.
But the boom times seem to be over. For the ones who have remained, the lavish lifestyles they once enjoyed have been replaced with stress – over meeting regulatory targets, passing discipline inspections and living on lower incomes.
“Everyone, from the top brass to people like us in middle ranks, earn less than before,” said a credit manager with Bank of China, one of the country’s “big four” state-owned banks, lamenting the loss of the staggering bonuses that she used to bag in the industry’s heyday.
China’s financial sector is always beholden to the government … No businesses in any country can operate in a vacuum
Pay cuts, first imposed on executives of state-owned financial institutions in 2010 by the banking regulator and now an industry-wide practice, appear to be a preview of what’s in store for China’s fast-changing financial landscape.
