Senior executives at Chinese financial institutions may face a pay ceiling under a new rule drafted by the Ministry of Finance. Executive salaries at state-controlled firms would be capped at around US$410,000, the South China Morning Post reported, citing bankers who have seen the draft rule. The pay ceiling is intended to prevent a widening income gap amid a slowing economy. However, the earnings of top executives in China’s financial sector currently fall short of the limit. According to company reports, Jiang Jiangqing, chairman of Industrial and Commercial Bank of China, took home US$262,000 in pre-tax salary last year. His counterparts at China Construction Bank and Bank of China, Guo Shuqing and Xiao Gang, earned US$260,000 and US$244,000 respectively. The draft rule says CEOs should receive US$7,300-102,000 in basic pre-tax salary. They may also receive a performance-linked pay of no more than three times the basic salary.
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