Chinese New Year has come early for Capital Securities Corp, a Taiwan broker.
Chairman Alex Wang Jiunn-Chih said the average year-end bonus for his stockbrokers was about 13.5 months of their basic salary, with the best achiever scooping up a bonus worth 80 months.
Despite that stunning figure, the actual size of the bonus was much less dramatic.
Given a Taiwan broker makes about NT$22,000 (US$746) a month, Capital Securities brokers would receive a bonus of at least NT$297,000 and the star broker would get no less than NT$1.76 million.
But the whopping bonus reflected a strong performance in Taiwan, which maintained one of the longest bull markets, with the Taiwan Stock Exchange Weighted Index above 10,000 points for 156 days.
The benchmark index closed the year at 10,642, up 15% from the end of 2016, and continued to search for a new high this year – similar to the Hong Kong and Shanghai markets.
Hong Kong brokers also riding high
Brokers in Hong Kong also had expectations of a healthy bonus after it recorded the best performance of the world last year. The Hang Seng Index broke a historic high yesterday and traded above 32,000 for the first time with heavy turnover – which will benefit stockbrokers.
Likewise, the Shanghai market has gone up every trading day this year – with the exception of January 15 – in a typical slow bull mode.
Many brokers believe the bull run in Greater China will continue at least in the first half before China’s A-shares are officially admitted to the MSCI key index in June.
That goes in tandem with Beijing’s plan to convert nearly US$400 billion in non-tradable state-owned shares into free-floating shares, which will help state-owned companies reform and lower their overall debt level.
Despite a strong equity market, Hong Kong lost its IPO crown to New York last year after two straight years on top because it failed to attract mega IPOs. The total money raised from initial public offerings in Hong Kong dropped to US$16.3 billion, as compared to $49.5 billion in the United States, according to Dealogic.
But things are looking brighter this year, with Xiaomi and Ant Financial seen as more likely to chose Hong Kong over New York for their IPOs.
And this boom period for Chinese brokers is generally reflected in their fat pay cheques.