Last year's bank "reverse salary collection" ledger: some recovered nearly 50 million yuan, others doubled

The wages that have been paid out can still be reclaimed. “Reverse salary collection”—banks are taking it seriously.

Recently, a reporter from Southern Metropolis Bay Finance Society reviewed the 2025 annual reports of listed banks and found that many banks mentioned last year’s performance-based compensation recovery and clawback in their annual reports. Among them, Bank of China had the largest clawback amount and number of cases, at 4717.82 million yuan and 4630 cases, respectively. Zheshang Bank, Bohai Bank, and Zhongyuan Bank also reported clawback amounts of more than 10 million yuan.

Compared with the previous year, some banks saw a large increase in both clawback amount and number of cases. For example, Dongguan Rural Commercial Bank and Chongqing Rural Commercial Bank both doubled their clawback amounts.

Some banks recovered more than 47 million yuan

The so-called performance-based compensation recovery and clawback refers to a compensation management arrangement in which, for financial institutions’ senior management personnel, key-position personnel, and other responsible personnel, due to illegal and noncompliant conduct or risk losses caused by incorrect payment or failure to diligently carry out their duties, the institution may withhold the unpaid portion or all portions of remuneration within the corresponding period, and may also reclaim performance-based compensation that has already been paid.

Based on statistics compiled by the Southern Metropolis Bay Finance Society reporter from bank annual reports, at least ten banks disclosed performance-based compensation recovery and clawback data for 2025.

Among state-owned banks, Bank of China disclosed that in 2025 the bank executed recovery and clawback from 4630 people/cases, with a total amount of 4717.82 million yuan. On average, the amount reclaimed per person/case was 1.02 million yuan. In 2024, Bank of China carried out recovery and clawback for 2469 people/cases of performance-based compensation totaling 3250 million yuan. Compared side by side, the number of people/cases increased by 87.53% year-on-year, while the amount increased by 45.16% year-on-year.

In their annual reports, other state-owned banks all stated that they had established mechanisms for deferred payment of performance-based compensation and recovery and clawback, but they did not disclose specific recovery-and-clawback data.

Among joint-stock banks, Zheshang Bank, Bohai Bank, and Huaxia Bank disclosed relevant data. Zheshang Bank executed recovery and clawback of performance-based compensation from 970 people/cases, with the total performance-based compensation recovered amounting to 1368.73 million yuan, and an average of 1.41 million yuan per person/case. Compared with 2024, the number of people/cases decreased by 31.88%, and the amount decreased by 54.88%.

Bohai Bank recovered performance-based compensation from 816 people/cases totaling 1958 million yuan last year, averaging 2.40 million yuan per person/case. Compared with 2024, the number of people/cases increased, but the amount declined.

Last year, Huaxia Bank recovered performance-based compensation from 577 employees, with the total recovered performance-based compensation amounting to 985.03 million yuan and an average of 1.71 million yuan per employee. Compared with 2024, both the number of people/cases and the amount declined. It is worth noting that the bank stated that there was no recovery and clawback of performance-based compensation for senior management personnel.

Some city commercial and rural banks doubled their recovery amounts

Some city commercial banks and rural commercial banks also disclosed “reverse salary collection” data. Among them, Zhongyuan Bank recovered 1357.15 million yuan, the highest among the city commercial and rural commercial banks that disclosed such data.

Based on statistics from Enterprise Early Warning Pass compiled by the Southern Metropolis Bay Finance Society reporter, in 2025 Zhongyuan Bank received 32 regulatory penalty orders issued by regulatory authorities, including 10 institutional penalty orders and 22 individual penalty orders, with a total confiscation/fine amount of 481 million yuan.

In addition, Ruifeng Bank recovered 382.21 million yuan in 2025; Dongguan Rural Commercial Bank, in 2025, made responsibility determinations in accordance with regulations and recovered a total of 366 million yuan; Harbin Bank recovered over 308 million yuan of performance-based compensation in 2025, involving 321 people/cases; Chongqing Rural Commercial Bank cumulatively recovered 290.93 million yuan of performance-based compensation in 2025; and in 2025, the number of people held accountable for violations at Gansu Bank involved 43 people/cases, with recovery of 13.5 million yuan of performance-based compensation.

Compared with state-owned banks and joint-stock banks, most city commercial banks and rural commercial banks recovered lower amounts of performance-based compensation. However, compared with 2024, the overall increases were generally much larger. For example, Dongguan Rural Commercial Bank, Chongqing Rural Commercial Bank, and Gansu Bank all saw their recovered amounts increase by more than a factor of two. Harbin Bank’s recovered amount increased by nearly 50%, while the number of people/cases executed increased by 176%, rising from 116 people/cases in 2024 to 321 people/cases.

Efforts should be made to avoid selective enforcement against certain senior executives

The Southern Metropolis Bay Finance Society reporter learned that recovery and deferred payment mechanisms complement each other. This is because financial business has a lag in risk exposure. Using deferred payment tools can balance current and long-term considerations, yield and risk considerations, and provide convenience for executing recovery and clawback.

In February 2020, the former China Banking and Insurance Regulatory Commission issued the “Guidelines for the Prudential Regulation of Compensation of Commercial Banks.” It clearly stated that for senior management personnel of commercial banks and employees in positions with significant influence on risks, at least 40% of their performance-based compensation should be paid in the form of deferred payment, with the deferred payment period generally not less than 3 years. For the performance-based compensation of main senior management personnel, the deferred payment ratio should be higher than 50%, and where conditions permit, efforts should be made to reach 60%.

The guideline also emphasized that commercial banks should formulate rules on deferred recovery and clawback of performance-based compensation. If, within the specified period, risks leading to extraordinary risk losses caused by senior management and relevant staff exceed normal levels for risks within their duties, the commercial bank has the right to fully reclaim all performance-based compensation already paid within the corresponding period and to stop payment of all unpaid portions. The rules on deferred recovery and clawback of performance-based compensation formulated by commercial banks should also apply to personnel who have left.

In January 2021, the former China Banking and Insurance Regulatory Commission issued the “Guiding Opinions on Establishing and Improving the Mechanism for Recovery and Clawback of Performance-Based Compensation of Banking and Insurance Institutions” (hereinafter referred to as the “Guiding Opinions”). It specified the concrete circumstances for executing recovery and clawback. The guidance provides that, for senior management personnel and key-position personnel who have conduct involving illegal acts, violations, or disciplinary violations, banking and insurance institutions should reclaim part or all of the performance-based compensation within the corresponding period based on the severity and circumstances.

At the same time, when a banking and insurance institution is faced with four circumstances, it shall claw back all performance-based compensation within the corresponding period from senior management personnel and key-position personnel who bear primary responsibility, and reclaim part of the performance-based compensation within the corresponding period from other responsible personnel. The four circumstances are: when important regulatory indicators seriously fail to meet requirements or deviate from a reasonable range; when risk disposal measures such as takeover are taken by the China Banking and Insurance Regulatory Commission and its dispatched institutions or other financial regulatory authorities; when major risk events occur and cause adverse impact on financial market order; and other circumstances that cause major damage to the institution’s property, reputation, etc.

According to the “Three-Year Campaign for Achieving Remarkable Results in Improving Corporate Governance in the Banking and Insurance Industry,” published by the former CBIRC in March 2023, more than 95% of banking and insurance institutions have formulated and implemented systems for deferred payment of performance-based compensation and for recovery and clawback.

Relevant staff of the Beijing Regulatory Bureau of the National Financial Regulatory Administration previously published an article stating that financial institutions can strengthen the intensity of executing recovery and clawback, insisting on its application as a normal practice. First, they should fairly and strictly implement the relevant systems, avoiding the non-execution or selective execution of such systems for certain senior executives or retired employees. Second, they should fully use legal means to carry out “reverse salary collection.” Through means such as labor dispute mediation and arbitration, as well as civil litigation, they should pursue compensation liability for those who refuse to return funds, creating rigid constraints and preventing some practitioners from developing a mentality of luck. Third, they should effectively link performance-based compensation with prudent risk-taking, turning regulatory policy requirements into industry development and institutional operating conviction, thereby truly forming a culture of sound and steady operations, and realizing the stable, healthy, and sustainable development of commercial banks.

Byline: Liu Lanlan, Southern Metropolis Bay Finance Society