According to media reports, 52 executives have left their positions in leading state-owned financial institutions. (Photo : Reuters)
Following the economic slowdown in the country, executive officers from major Chinese banks have departed in search of better opportunities, the China Daily reported. Bad loans and declining profits also plague the sector.
According to media reports, 52 executives have left their positions in leading state-owned financial institutions, such as the Construction Bank of China and the Bank of China, for personal reasons or better offers.
"Internet financing companies have grown very rapidly in China, so it's natural that executives at traditional banks are leaving for the new companies that offer better-paid jobs," said Wu Qing, deputy director of banking research at the Development Research Center of the State Council, in an interview with China Daily.
Public filings on China's stock exchanges have so far shown 10 out of 16 listed banks where executive members such as the president or vice president have left, leaving the positions vacant.
These departures are added pressure in the struggling banking industry. According to the China Daily report, profits earned by state lenders in the third quarter have dropped to below 1 percent.
Aside from the economic slowdown, unattractive salaries, intense competition, and the rising private banking sector have driven these executives to leave their posts.
Despite this, some say that the exodus is the effect of hefty pay cuts imposed by the Chinese government last year. Mid-level positons might be affected next.
"Previously, the impact of pay cuts was limited to the big bosses of the banks," said Wu, "but now it could extend to mid-level executives as a result of this year's poor performance in a downward economic cycle."
