The million-dollar bonus has arrived in China’s financial services industry.

Fierce competition has forced companies to start offering Wall Street-type compensation, especially in the fund management industry.

Executives report a big increase in CVs received from US-based professionals with a China connection. Peter Alexander, head of fund management consultancy Z-Ben Advisors said, ‘There were several bonuses over a million dollars last year. Retaining assets is no longer the top priority, it is getting and retaining good people.’

The fund management industry has seen an explosion in assets under management from $40 billion in 2005 to around $450 billion by the end of 2007.

A senior executive at a Shanghai-based fund management company who asked not to be named said, ‘I personally know of at least half a dozen managers who made more than a million dollars.’

China has 60 approved asset management companies, almost half of which are joint ventures or have foreign shareholders.

Industry executives complain about the small number of people qualified to manage funds at local fund management companies — one executive said about 300 people had all the required regulatory qualifications.

Perhaps we will see a Chinese equivalent of Tom Wolfe’s The Bonfire of the Vanities. The bonuses are already at the level reached in that amazing novel.
Source: Financial Times