KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
China Minsheng Bank has cut salaries by up to 50% for employees at its Beijing branch, according to two sources familiar with the matter. This move, part of a broader austerity drive, is the largest pay reduction by a major Chinese commercial bank in recent years. The pay cuts come alongside the suspension of work-related expenses and other benefits for the 4,000+ employees at the bank’s Beijing branch.
Although it remains unclear if these measures will be implemented at other branches, this austerity aligns with China's "common prosperity" initiative, which seeks to address social and income inequality.
Minsheng Bank, founded in 1996 as China's first privately controlled commercial bank, has faced significant challenges, including exposure to the country's ongoing property crisis. The lender has been impacted by its role as a major creditor to China Evergrande Group and the financial difficulties of China Oceanwide, one of its largest shareholders.
The pay cuts also reflect concerns over profitability in the banking sector, as Chinese lenders are under pressure to lower lending costs to stimulate an economy facing deflation risks and a prolonged property slump. China's banking sector reported its lowest-ever net interest margin of 1.54% at the end of June.
In the first half of 2024, Minsheng Bank saw a 5.5% decline in net profit and a rise in its non-performing real estate loans to 5.29%. Despite Minsheng Bank denying the salary cuts after the story broke, the move echoes a broader trend in China's financial industry, where firms are cutting salaries and implementing measures to curb excesses in response to economic challenges.
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