China’s largest investment bank intends to move dozens of Hong Kong bankers to cut costs

China’s Citik Securities plans to move dozens of bankers from its Hong Kong offshore platform CLSA to the mainland to cut costs and meet Beijing’s call to bridge income inequality in the financial sector, sources familiar with the matter said.

In an unusually broad step in an industry where individual transitions are more common, CLSA is expected to demand investment bankers move to the Chinese mainland while reducing their salaries to local levels or facing the possibility of losing their jobs.

One person confirmed that Citik, China’s largest investment bank in terms of market value, was pushing to cut costs in its external arm as deal-making stalled.

The move comes weeks after CITIC cut wages across its investment banking division, reducing the base salaries of mainland-based bankers by up to 15%.

Wealthy financial dealmakers in China have made wage cuts and curbed concessions across the sector as state-owned employers respond to Beijing’s “shared prosperity” campaign with austerity measures.

Employees’ income for Citik mainland employees was the highest among all investment banks in China last year, according to annual corporate disclosures, reaching an average of 840 thousand yuan (US $ 117107.45) per capita.

The first person said that the first batch of CLSA employees due to be transferred early this week is expected to be determined, with about a “single digit” number affected within the investment banking division based on performance evaluation.

The person added that more was likely to be affected in subsequent rounds.