Here is an interesting observation–of how Chinese banking works with authoritarian oversight from the government. It may be a model for future reforms in the west, given the problems with banks in the US and Europe these days.
Today, Jiang Jianqing has a somewhat bigger job: running the world’s biggest bank, Industrial and Commercial Bank of China.
But he does the work for an annual salary that might make a hardened socialist nod with approval. He earned $150,000 in 2010, a mere 1.5 percent of Bank of America Corp CEO Brian Moynihan’s estimated $10 million pay last year, and half again smaller than the $20 million Jamie Dimon was paid for running JP Morgan.
One observation is that his salary is much less than in western banks, but there is also the observation that his responsibilities are judged by party members rather shareholders.
As Jiang’s example shows, China’s top bank bosses are a different breed to their Western counterparts. Beneath their coiffured hair and tailored suits, the likes of CCB Chairman Guo Shuqing and ICBC’s Jiang are first and foremost Communist Party members appointed to their jobs by the government.
China’s biggest financial institutions fall under the supervision of the Communist Party, so the bank heads also sit on the party’s Central Committee that is ultimately headed by the country’s President Hu Jintao.
Maybe there is something to be said for banks working for the good of government economic policy. Perhaps the days of a free market in the banking sector are outdated.