China's regulators face hefty pay cuts

Agencies and staff reporter

China is set to slash pay for staff at its top three financial regulators, including the central bank, as part of a regulatory revamp unveiled in 2023 to bring their salaries in line with other civil servants.

Starting this month, staff at the People's Bank of China, National Financial Regulatory Administration and China Securities Regulatory Commission will see salaries slashed by about half, four sources said.

The hefty pay cuts would come against the backdrop of China's current focus on boosting consumption, including spending by millions of civil servants, as part of its efforts to maintain a stable growth rate in 2025.

The cuts would also mark a shift in the remuneration policy for staff at the financial regulatory bodies and would come two years after a regulatory revamp that was aimed at consolidating powers and oversight at the top of the government.

Meanwhile, the PBOC vowed to continue to lower borrowing costs for banks this year, aiming to ease their stress in net interest margins.

New yuan loans totaled 990 billion yuan (HK$1.05 trillion) in December, beating market estimates, after a series of stimuli by Beijing in past months, according to Reuters' calculations based on central bank data.

As of the end of last month, foreign institutions held 4.16 trillion yuan of China's interbank market bonds and newly bought bonds by foreign investors in December totaled around 10 billion yuan, ending a three-month holdings reduction.

Goldman Sachs and clients are taking a wait-and-see approach on whether Chinese authorities will push out major stimulus measures to revive the economy after seeing some momentum in the second half of last year, according to Kevin Sneader, president of the Asia-Pacific ex-Japan division at the bank.

There has been "some reallocation" back to China from clients while there's still caution around investing in the nation, Sneader said in an interview on Bloomberg Television in Hong Kong.