Event:
On February 8, the central bank and the China Banking and Insurance Regulatory Commission issued the notice on the exclusion of loans related to affordable rental housing from the management of real estate loan concentration (hereinafter referred to as the notice), which made it clear that loans related to affordable rental housing projects were not included in the management of real estate loan concentration, and encouraged banking financial institutions to follow the principles of legal compliance, controllable risk and commercial sustainability, Increase support for the development of affordable rental housing. Our comments are as follows:
Comments:
I. The notice aims to moderately "correct" the double concentration policy of real estate
Strengthening financial support for affordable housing is a policy guidance clearly put forward by the central government and regulatory authorities in recent years. As early as the end of 2020, the central bank In response to a reporter's question, the CBRC immediately proposed: "In order to support the vigorous development of the housing rental market, the housing rental related loans will not be included in the calculation of the proportion of real estate loans for the time being. At present, the people's Bank of China is working with relevant departments to study and formulate relevant opinions on housing rental financial business and establish corresponding statistical systems. At that time, the housing rental related loans that meet the definition will not be included in the scope of centralized management statistics."
In the early stage, for some financial institutions whose "double concentration" indicators of real estate are close to the regulatory red line or need to appropriately reduce the proportion of housing related loans, while complying with the guidance of regulatory policies and increasing the supply of affordable housing credit, it will also cause further pressure on the "double concentration" indicators. In view of this, the notice makes it clear that the loans related to affordable rental housing projects are not included in the concentration management of real estate loans, which is an appropriate "correction" of the early "double concentration" policy to avoid the "one size fits all" regulation requirements.
II. The impact of the notice on the housing related loans of commercial banks is relatively limited
After the promulgation of the notice, the market is more concerned about whether this policy will contribute to the further development of "wide credit", and whether the "double concentration" index will significantly improve the release of bank housing related loans after the "deregulation"? We can analyze it from two aspects:
From the perspective of credit volume, indemnificatory housing includes indemnificatory rental housing, common property right housing and public rental housing, of which indemnificatory rental housing accounts for a relatively large proportion.
At present, the disclosure criteria of affordable housing credit data in the market are not unified. As of Q3, 2021, the balance of affordable housing development loans disclosed by the central bank was 4.64 trillion (Q4, 2021 was not disclosed), while the affordable housing project loans according to the cbcirc criteria exceeded 6 trillion, of which the loans for the reconstruction of dangerous houses in shantytowns and reclamation areas accounted for nearly 95%, and the remaining loans were public rent, low rent Loans for affordable housing, limited price commercial housing, reconstruction of dilapidated houses in rural areas, settlement projects for nomads and reconstruction of old urban communities.
In terms of the main investors, the loans for affordable housing projects are mainly policy banks, accounting for more than 75%; Its China development bank exceeds 3 trillion, accounting for about 50%, and the proportion of agricultural development bank is also large. The loan balance of affordable housing projects of commercial banks is relatively low, which is mainly dominated by the four major banks.
Assuming that the main structure of indemnificatory housing development loans and housing project loans is generally consistent, it is estimated that the balance of indemnificatory rental housing loans of each commercial bank is only tens of billions, and it is mainly dominated by large state-owned actors, with a total volume of about 100-300 billion.
For commercial banks, due to the low loan balance of affordable housing projects, the policy allows stock loans not to be included in the statistical caliber of "double concentration", which has a limited effect on the improvement of bank concentration indicators, and it is difficult to guide banks to increase the investment of housing related loans.
Another significance of the notice is that previously, the construction of indemnificatory rental housing mainly applied for policy bank loans according to the special urban housing project. After the promulgation of the notice, more commercial banks can apply for indemnificatory housing development loans, which provides more capital supply options for local urban investment companies and state-owned enterprises, and opens up financing space to a certain extent, It is conducive to accelerating the construction of affordable housing.
III. at this stage, the "double concentration" constraint is not the core contradiction of weak real estate financing. Weak demand and prudent risk preference make real estate loans in a "difficult period"
At present, the prosperity of the real estate market is weak, the growth rate of development investment and sales continues to have a deep negative growth, the housing related financing is still in a "difficult period", the financial pressure of local governments is increasing, and the "urban investment" companies are more involved in the land market. Specifically:
Development loans show a "uneven hot and cold" trend, credit resources mainly flow to local real estate enterprises with government background, and the financing availability of private enterprises is poor. According to the loan investment report disclosed by the central bank, the development loan in 2021q4 has a negative growth of 150 billion, and Q2 ~ Q4 has a negative growth quarter by quarter, with a cumulative negative growth of 410 billion. In January this year, the total land acquisition of the top 100 real estate enterprises decreased by 63% year-on-year, and most of the land acquisition institutions are local real estate enterprises with government background. At the same time, under the continuous pressure of sales, some real estate enterprises are under great pressure to "guarantee the delivery of houses". The rigid payment of migrant workers' wages before the Spring Festival consumes the cash flow of enterprises. The suspension of land acquisition by real estate enterprises will increase the local financial pressure, and then increase the intensity of urban investment and financing. On the other hand, the bank's risk appetite is still relatively cautious, and the willingness to extend credit to private real estate enterprises is weak, resulting in poor financing availability of private enterprises. Based on this, we judge that the investment of development loans in January was still "uneven", and the new housing related financing mainly migrated to banking and government financing business.
Mortgage demand is weak, and the growth of follow-up mortgage loans will still be under pressure. Under the contradiction between supply and demand, there is a large downward space for mortgage loan pricing. From October to November in 2021, new mortgage loans increased in a large amount, but with the gradual consumption of project reserves, the scale of mortgage loans began to decline in December. In December, 355.8 billion medium and long-term loans were added to residents, and the new scale of mortgage loans is expected to remain at about 200 billion, with a small increase year-on-year. From the situation since this year, the demand for new mortgages is still insufficient, residents have a strong wait-and-see mood with money, and real estate sales are weak. It is expected that the new mortgage loans in January may continue the trend of less growth year-on-year. At the same time, this year's Lunar New Year is located at the end of January. Considering the amortization pressure of mortgage loans during the Spring Festival and in February, it is not ruled out that the shrinking trend of mortgage loan increment in February is further deepened. It is expected that the cumulative mortgage increment from January to February will increase less year-on-year.
According to the data of Shell Research Institute, in January 2022, the interest rate of the first mortgage and the second mortgage in 103 key cities was 5.56% and 5.84%, both of which were 8bp lower than that in December 2021. The average lending cycle in January was 50 days, shortened by 7 days month on month. The shortening of the lending cycle and the weakening of demand will exacerbate the contradiction between supply and demand of mortgage loans. Although the 5bp reduction of 5y-lpr in January, the squeeze of the contradiction between supply and demand may make the downward range of mortgage loan pricing greater than the 5bp step of the 5bp reduction of 5y-lpr.
Based on the above analysis, we believe that although the "double concentration" constraint has strengthened the control of bank real estate loan, it is not the core contradiction of weak real estate financing. The notice aims to "correct the deviation" of the dual concentration policy, but it has limited effect on promoting the process of wide credit, loosening the restrictions on bank real estate loans and encouraging the increase of real estate loans.
At present, the core contradiction of the real estate market lies in insufficient demand and prudent risk appetite. The sales growth rate of the real estate market continues to be negative, and the real estate financing is still in a "difficult period". Although the regulatory authorities have recently launched some phased measures to stabilize the market, including:
(1) promote market-oriented M & A, including the issuance of M & A loans and M & A bonds. However, market-oriented M & A is easy to lead to the instability of the asset price system, which will further deepen the problem of venture real estate enterprises.
(2) the rigid payment of migrant workers' wages uses closed funds.
(3) some cities, especially the third and fourth tier cities, are represented to adjust the housing provident fund policy. It mainly includes raising the loan amount of housing provident fund, changing the policy of housing and loan recognition, reducing the down payment ratio of second house, raising the lower limit of deposit base, the down payment of housing provident fund available for talent purchase, relaxing the extraction and use conditions of housing provident fund, expanding the use of housing provident fund, etc.
However, from the actual effect, the intensity of relevant phased measures is still not enough to reverse the downward trend of the real estate market. The future real estate policy needs to "address both the symptoms and root causes". By stabilizing real estate sales, smoothing the capital circulation, restoring the hematopoietic capacity of real estate enterprises and filling the hole of "guaranteed housing" funds.
In this case, we predict that the real estate policy will be further relaxed in the future, such as alleviating the cash flow pressure of problematic real estate enterprises through targeted support measures, in which AMC may play a certain role, that is, adopting policy M & a rather than pure market-oriented M & A arrangements to avoid the possible asset Cycle Selling caused by highly dependent market-oriented M & A, Prevent a sharp collapse in asset prices.
IV. risk warning
The downward pressure on the macro economy has increased, and the credit easing is less than expected.
