One after another, the big names in global finance were summoned by Chinese officialdom. On the agenda: pay—specifically, telling Credit Suisse Group AG, Goldman Sachs Group Inc., and UBS Group AG to report details on how they compensate their top bankers.

Don't reward your top people too lavishly, Chinese regulators warned the banks this year in meetings in Shanghai and Beijing, or you might run afoul of the Communist Party, according to people familiar with the matter. The say-on-pay meetings, reported here for the first time, are just one of the many potholes that global banks have hit lately on their long, rocky road into China. After years of losses or skimpy returns, some of them are reassessing their prospects. Short-term, the outlook isn't good.

Hopes that banks' business in China finally might be paying off have been dented and dented again. China's Covid-19 lockdowns; its volatile markets; and moves by its leader, Xi Jinping, to reshape the business scene—and reassert the state's control—have reverberated through banks in New York, London, and Zurich.