[Financial Report Analysis] Both revenue and net profit have increased. For China CITIC Bank, it is not easy in 2020. What is a little strange is that the bank’s senior management salaries have suffered major cuts.
The annual report shows that CITIC Bank achieved total revenue of 194.731 billion yuan in 2020, a year-on-year increase of 3.81%; it achieved a net profit attributable to shareholders of the parent company of 48.98 billion yuan, a year-on-year increase of 2.01%. In particular, the company's net profit growth rate exceeds 2%, which is better than the net profit growth rate of less than 1.5% for many major state-owned banks, and even exceeds the company's 1.14% growth rate in 2016.
However, the annual report shows that in 2020, CITIC Bank’s remunerated directors, supervisors and senior managers (including current and former employees) have actually received a total of 27.299 million yuan in pre-tax remuneration from the company.
The total salary seems to be a lot. For example, compare the total salary of Industrial and Commercial Bank of China. In 2020, ICBC has paid a total salary of 12.4822 million yuan to directors, supervisors, and senior managers. The salary of CITIC Bank's senior executives is more than twice that of "Universal Bank".
The key problem is that if compared with China CITIC Bank's total salary in 2019, it will be more than halved. wind Big data shows that the total salary of all current and former senior executives of China CITIC Bank in 2019 was 65.03 million yuan. The total salary of senior executives in 2020 will be reduced by approximately 37.73 million yuan, a decrease of approximately 58%, which is approximately a 40% discount.
The remuneration distribution plan for directors and senior managers of CITIC Bank is formulated by the nomination and remuneration committee of the board of directors. The remuneration policy for supervisors is formulated by the nomination committee of the board of supervisors and, like the remuneration policy for directors, must be submitted to the shareholders' meeting for approval.
CITIC Bank provides directors, supervisors and senior managers who are also employees of the bank with remuneration corresponding to their positions, including wages, bonuses, subsidies, employee welfare fees and various insurance funds, housing provident funds and annuities. The remuneration of independent directors and external supervisors consists of three parts: basic remuneration, linked floating remuneration and allowances.
In 2019, 15 senior executives of China CITIC Bank received a salary of more than 3 million yuan; in 2020, no senior executive received a salary of more than 3 million yuan. The highest salary was President Fang Heying, whose salary was 2.38 million yuan, which was approximately 3.02 million yuan less than in 2019. Fang Heying received his salary from January to November 2020 in the industry, and he started receiving salary from CITIC Holdings in December 2020.
Except for independent directors, the salaries of basically all senior executives have been reduced by more than one million yuan. Four senior executives received a reduction of more than 2 million yuan, and the chairman of the board of supervisors also had a salary reduction of 2.38 million yuan. The chairman does not receive salary within the industry; some independent directors and supervisors also saw a salary reduction of about 10,000 to 20,000 yuan.
CITIC Bank stated in its annual report that the company implements the bonus deferred payment policy and further improves the salary distribution mechanism that is compatible with competitiveness enhancement, risk control, and steady development. Therefore, the apparent "sharp drop" in executive compensation may be related to this. Of course, the specific situation will need to wait for the company to release further relevant information (if any) or the 2021 report before making comparisons.
Read the senior management and then the employees. The overall salary level of CITIC Bank employees has increased.
As of the end of 2020, CITIC Bank had a total of 58,879 employees of various types. Among them, there are 57,600 contract employees, 1,279 dispatched and employment agreement employees, and a total of 1,860 retirees. In terms of positions, there are 11,789 management personnel, accounting for 21.38%; 40,131 business personnel, accounting for 72.76%; and 3,234 support personnel, accounting for 5.86%.
In 2020, the total employee compensation of CITIC Bank was 29.679 billion yuan, which was approximately 2.169 billion yuan more than the 27.51 billion yuan in 2019. Last year’s per capita salary was 504,100 yuan, an increase of approximately 21,900 yuan compared with 2019. The per capita profit was 831,900 yuan, about 10,000 yuan less than in 2019.
At the same time, the total compensation of senior executives of CITIC Group's financial companies, CITIC Securities , in 2020 is about 149 million yuan, a slight decrease of more than 5 million yuan compared with 2019. Some senior executives also have a reduction of one million yuan, but their salaries are much higher than those of CITIC. In banks, salary cuts are also much smaller. (charts and data in the text come from wind)
