All 26 securities firms will see increased revenue and net profit in 2025, with 7 entering the "Double Billion Club," but the pay gap has widened.

Ask AI: Why is there a “scissors-gap” phenomenon in securities-company compensation, with staff pay rising while executives’ pay falls?

Against the backdrop of active domestic capital-market trading in 2025, with the Shanghai Composite Index gaining in double digits over the full year and the daily average trading value across the Shanghai and Shenzhen markets hitting a new all-time high, the securities industry has also turned in an impressive performance. As of March 30, 26 listed securities firms and securities-concept stocks had released their 2025 results. In terms of revenue and net profit, all 26 institutions are profitable, and year-on-year growth has become an industry trend. Among them, CITIC Securities and Guotai Junan are clearly ahead of the rest, with seven institutions entering the “double-billion club” for both earnings categories.

Driven by the sustained rebound in performance, most securities firms have also stabilized the downward trend in average staff compensation per employee and have increased it somewhat. By contrast, executives’ total annual compensation has continued to narrow, with most still showing year-on-year declines; the largest drop reaches 37%. In the view of industry insiders, the current securities-compensation system has entered a long-term adjustment cycle: shifting from “maximizing short-term incentives” to a “long-term, steady orientation,” and the divergence in compensation structures between executives and staff may become the norm.

Seven institutions enter the “double-billion club”

As more major brokerages—such as Huatai, Galaxy, CICC, and 广发—disclosed their latest annual reports on March 30, the number of listed securities firms and securities-concept stocks releasing 2025 performance updates increased to 26. Overall, the 26 institutions together achieved operating revenue of RMB 454.71B, up 31.93% year on year; total net profit attributable to shareholders also reached RMB 185.06B, up 44.61% year on year.

From the perspective of a single institution, on operating revenue, CITIC Securities ranks first with RMB 74.85B, followed closely by Guotai Junan with RMB 63.11B, becoming the only two brokerages to break through the RMB 60 billion revenue mark. In the same period, 13 other brokerages—including Huatai Securities, GF Securities, and China International Capital Corporation—also posted operating revenue exceeding RMB 10 billion.

On net profit attributable to shareholders, CITIC Securities and Guotai Junan lead by a wide margin as well, reaching RMB 27.81B and RMB 16.38B, respectively, making them the only two listed securities firms with net profit attributable to shareholders exceeding RMB 20 billion. In addition, the others that also achieved profits above RMB 10 billion include Huatai Securities, GF Securities, China Galaxy, Merchants Securities, and East Money, at RMB 12.09B, RMB 634.2k, RMB 12.52 billion, RMB 12.35 billion, and RMB 513.7k, respectively.

Overall, seven institutions have already entered the “double-billion club” for both operating revenue and net profit attributable to shareholders. By comparison, in 2024 the number was five, all of which remained in the club, and GF Securities and East Money also newly entered the group. Furthermore, if you sort brokerages with net profit attributable to shareholders exceeding RMB 9 billion, then CICC, Shenwan Hongyuan, and China Minsheng? (CITIC?)/? (CITIC?) may also be “on standby.”

Looking at year-on-year growth rates, all 26 institutions saw increases in both operating revenue and net profit. Among them, Guotai Junan and Guolian Minsheng, which completed integration in 2025, led across the industry in both operating revenue and net profit attributable to shareholders. Guotai Junan’s increases were 87.4% and 113.52%, respectively; Guolian Minsheng’s figures rose even more to 185.99% and 405.49%.

Apart from the two institutions, some brokerages also achieved large growth in net profit attributable to shareholders in 2025. For example, among leading brokerages, CICC and Shenwan Hongyuan both saw growth of more than 70%; while Xiangcai Co., Ltd.’s net profit attributable to shareholders growth of 325.15% also demonstrates the high elasticity of performance from smaller and mid-sized brokerages.

Tian Lihui, a professor of finance at Nankai University, analyzed and said that in 2025, the overall performance of the securities industry improved, mainly benefiting from the dual drivers of capital-market recovery and the release of policy dividends. From the annual reports already disclosed, proprietary investment and wealth management became the core engines of performance growth. The strength of proprietary businesses stems from the sharp increase in fair value change gains brought about by the upward movement of market indices—this is the most direct reflection of brokerages’ balance-sheet repair. Meanwhile, the growth in wealth management reflects that the industry’s shift from pure agency/channel trading toward asset-allocation service has begun to take effect. These two major areas jointly constitute the main sources of brokers’ earnings elasticity, and also confirm the high positive correlation between broker profitability and market conditions in an environment with ample liquidity.

Average compensation per employee rises the most by up to 30%

Against the backdrop of continuous performance rebound over the past few years, most listed securities firms’ average compensation per employee in 2025 also finally stopped falling, stabilized, and rebounded.

According to data from East Money Choice, based on the formula “average staff compensation per employee = (compensation paid to employees + end-of-period accrued compensation payable to employees - beginning-of-period accrued compensation payable to employees) / [(number of employees at beginning of period + number of employees at end of period) / 2],” after excluding Guotai Junan and Guolian Minsheng, whose data may have deviations due to integration-related reasons, among the 24 securities firms and securities-concept stocks that have disclosed their 2025 annual reports, as many as 21 institutions saw their average compensation per employee rise year on year in 2025. From the range of growth rates, the increases are mostly concentrated between 5% and 20%.

Specifically, the most noticeable increase in average compensation per employee was at Hu’an Securities, reaching 30.96%. Right behind were Industrial Securities, CICC, and Zhongyuan Securities, with increases of 26.35%, 24.4%, and 20.89%, respectively. Meanwhile, a reporter from Beijing Business Today learned from relevant personnel at Guolian Minsheng that, based on simulation consolidated comparison using 2024 data, the company’s average compensation per employee in 2025 (including benefits) was RMB 634.2k, up 21.2% year on year; average compensation per employee (excluding benefits) was RMB 513.7k, up 24%.

And when looking at compensation changes among the top three in industry performance, the growth rates are all within 5%. Among them, CITIC Securities increased from RMB 779.8k in 2024 to RMB 812.8k in 2025, up 4.23%; Huatai Securities increased from RMB 639.6k to RMB 669.1k, up 4.61%. In addition, regarding Guotai Junan, if you use (the total number of employees at the end of 2024 for Guotai Junan + the total number of employees at mid-2024 for Haitong Securities) as the number of employees at the beginning of the period, then its average annual compensation per employee in 2025 would be about RMB 709.8k, up 0.02%.

It is worth noting that many brokerages that saw a rebound in average compensation per employee in 2025 had previously experienced a relatively long period of compensation adjustment. Reviewing data from 2021 to 2024, some brokerages’ average compensation per employee were reduced for two or three consecutive years during that period, with the overall cumulative reduction reaching as much as 40%. At that time, analysts also pointed out that, due to the increasingly strict regulatory authorities’ requirements for standardizing the compensation systems of financial institutions, some brokerages adjusted their compensation structures—such as optimizing performance appraisal mechanisms and increasing the proportion of deferred compensation—which may have led to lower actual compensation paid to employees in the current period.

As for this round of relatively modest rebound in average compensation per employee, Tian Lihui believes it reflects a lagging manifestation of the industry’s improvement in business conditions, and it shows a relatively reasonable market-based linkage mechanism between compensation and performance. From the positive impact side, this change helps stabilize the talent pipeline and alleviates the pressure of core personnel attrition caused by industry pay cuts in the prior years. Looking deeper, expectations of a moderate compensation rebound can leave room for the industry to attract top talent; for the securities industry that is currently in a key period of transitioning to professional services such as investment banking and wealth management, stabilizing talent capital is crucial. Of course, the rebound is restrained overall, which also reflects that the industry is being more prudent and rational in compensation management.

Executives’ total compensation keeps narrowing

Compared with the rebound in average staff compensation, broker executives’ total compensation in 2025 is still declining. Based on the 26 listed securities firms and securities-concept stocks disclosed so far, the total executives’ compensation for 2025 is about RMB 372 million, down 8.2% year on year, further narrowing compared with 2024.

Among them, as many as 22 brokerages saw their executives’ total compensation fall year on year. Comparing the 2024 annual report data, during the 2025 integration and adjustment period, Guolian Minsheng and Guotai Junan both added multiple executives, causing their total executives’ compensation to rise.

Among brokerages with year-on-year declines, 10 firms—including Shenwan Hongyuan, China Galaxy, and Hu’an Securities—saw their executives’ total compensation drop by more than 20% year on year. Among them, Shenwan Hongyuan’s decline is as high as 37.41%; China Galaxy and Hu’an Securities also saw declines of 30.76% and 29.21%, respectively.

Why is there a relatively obvious “scissors gap” between average staff compensation per employee and the total amount of executives’ compensation? In the view of analysts, this is mainly driven by multiple factors, including regulatory orientation and adjustments to corporate governance logic.

Bai Wenxi, deputy director of the China Enterprise Capital Alliance, believes there are mainly three aspects. Specifically: policy compliance pressure—over recent years, the “pay cap” requirements in the industry have continued to intensify, and executives’ compensation at brokerages with a central SOE background is subject to stricter window guidance constraints; deferred payment mechanism—executives’ performance-based compensation is generally deferred for 3 to 5 years, and part of what is paid in 2025 actually corresponds to the relatively low performance period of 2022 to 2024; and risk-linked adjustments—regulatory requirements tie executives’ compensation to compliance and risk control, as well as long-term performance, so short-term profit growth is not necessarily immediately realized as cash compensation.

“This indicates that the securities-company compensation system has entered a long-term adjustment cycle: shifting from ‘maximizing short-term incentives’ to a ‘long-term, steady orientation.’ The divergence in compensation structure between executives and employees may become a norm. In the future, executives’ compensation will rely more on long-term equity incentives, while the elasticity of employees’ compensation with business-cycle fluctuations will increase,” Bai Wenxi said.

Tian Lihui also said that the divergence between the trends of executives’ compensation and ordinary employees’ compensation reflects the deeper logic of compensation-structure adjustments in the industry. This “scissors gap” phenomenon is directly related to the shift in compensation management philosophies under regulatory orientation in recent years, and the industry consensus is to “cap the high end, expand the middle, and raise the low end.” Concretely, the decline in executives’ compensation is not only affected by further strengthening of the deferral mechanism, but also reflects the rigid constraints placed on executives’ compensation under the state-owned enterprise evaluation system. It should be noted that this is not cyclical fluctuation, but a sign that the industry’s compensation system has entered a long-term, structural adjustment phase. Going forward, compensation will pay more attention to linking with risk cycles and matching long-term performance; executives’ incentive and constraint mechanisms will become more stable, while the incentive weight for backbone employees is expected to increase, in order to build a more sustainable pattern of talent development.

Beijing Business Today reporter Liu Yuyang