Event overview:
The central bank released the financial and social finance data for January 2022: RMB loans increased by 3.98 trillion yuan in January, an increase of 394.4 billion yuan year-on-year; RMB deposits increased by 3.83 trillion yuan, an increase of 262.7 billion yuan year-on-year; The growth rate of M2 was 9.8%, with a year-on-year increase of 0.4pct and a month on month increase of 0.8pct; M1 decreased by 1.9% year-on-year. Excluding the influence of the wrong timing of the Spring Festival, M1 increased by about 2% year-on-year. In January, social finance increased by 6.17 trillion yuan, a year-on-year increase of 984.2 billion yuan, and the balance increased by 10.5%.
Analysis and judgment:
In January, the improvement of corporate financing supported the increase of total credit, and the residential end was still weak
Under the centralized credit supply at the beginning of the year, RMB loans increased by 3.98 trillion yuan in January, reaching a record high. On the basis of last year’s high base, it still increased by nearly 400 billion yuan year-on-year, which exceeded the expectation to achieve a “good start” and also supported the basically stable credit growth (the growth rate of loan balance was 11.5%, and continued to decrease by 1.2pct and 0.1pct month on month).
In terms of structure, the residential side is still weak, mainly due to the large amount of corporate loans: 1) residential loans: 843 billion yuan was added in January, 427 billion yuan less than the same period last year, of which the monthly increment of short-term loans was only 100.6 billion yuan, 227.2 billion yuan less than the same period last year. Excluding the base factor, the overall performance is also weaker than seasonality. The repeated epidemic situation and economic downward pressure are the main factors restricting residents’ consumption; Medium and long-term loans increased by 742.4 billion yuan, returning to the normal level before the epidemic, with a year-on-year decrease of about 200 billion yuan under the high base. 2) Corporate loans: in January, an increase of 3.36 trillion yuan was added, an increase of 810 billion yuan year-on-year. Among them, corporate short-term loans exceeded trillion yuan for the first time in a single month (an increase of 1.01 trillion yuan, an increase of 434.5 billion yuan year-on-year), and the increment of medium and long-term loans reached a new high (an increase of 60 billion yuan year-on-year), reflecting the transition from broad money to broad credit. At the same time, it is worth noting that bills increased by 178.8 billion yuan in a single month, an increase of 319.3 billion yuan year-on-year under the low base, but there was a decrease compared with the end of the previous year. The main reason is that the draft of the Interim Measures for the administration of commercial bill acceptance, discount and rediscount was issued in January, which added two quota indicators for bill acceptance and discount from the perspective of ensuring the cashing capacity, To a certain extent, promote the transformation of loan form from bills to general enterprise loans.
Overall, the total amount of credit in January exceeded expectations, and the enterprise side had obvious support in structure, which reflected the effectiveness of policy stability maintenance and bottom support. It also had the impact that the pace of bank investment was more advanced under the expectation of interest rate reduction. At the beginning of the year, it made a good start. In the follow-up, we need to pay attention to the rhythm of economic endogenous power repair.
In January, the whole line of social finance increased more, and the growth rate continued to rise by 0.2pct
In January, the new social finance increased by 6.17 trillion yuan, an increase of 984.2 billion yuan year-on-year, and the balance growth rate increased by 0.2pct to 10.5% month on month. Structurally, all segments formed positive contributions: 1) in January, the issuance of government bonds and corporate bonds increased by 602.6 billion yuan and 579.9 billion yuan respectively, an increase of 358.9 billion yuan and 188.2 billion yuan year-on-year. The issuance of special bonds of local governments under the guidance of policies ushered in a peak. 2) The transition period of the new regulations on asset management has ended, and the off balance sheet non-standard financing (entrusted loan + trust loan + undiscounted acceptance bill) has increased by 447.9 billion yuan, a slight increase over the same period of the previous year. 3) RMB loans to entities increased by 381.8 billion yuan year-on-year. Overall, the further recovery of the growth rate of social finance reflects that under the policy tone of “stable growth”, the policy moves forward and superimposes the “good start” of banks to boost the demand for supporting financing. In the follow-up, the scale of social finance will also remain stable under the conditions that the total amount of credit remains stable, the non-standard drag is weakened, the new special debt limit is issued in advance and the physical workload is formed as soon as possible.
M2 growth rebounded and broad liquidity margin improved
Disturbed by the Spring Festival holiday in January, M1 grew by – 1.9%. According to the calculation of the central bank, excluding the influence of the wrong time of the Spring Festival, M1 increased by about 2% year-on-year, which is in line with the seasonality. M2 grew by 9.8%, up 0.4pct and 0.8pct respectively on a month on month basis, which is also the first year-on-year rebound since March last year, reflecting the improvement of broad liquidity driven by financing.
Under the derivative effect of large-scale credit supply, deposits increased by 3.83 trillion yuan in January, an increase of 262.7 billion yuan year-on-year. Affected by the dislocation factors of the Spring Festival, residents’ deposits increased by 3.93 trillion yuan year-on-year, while corporate and non bank deposits decreased by 2.35 trillion yuan and 71.6 billion yuan year-on-year respectively, and fiscal deposit expenditure increased by 585.1 billion yuan year-on-year.
Investment suggestions:
The total amount of credit and social finance data in January exceeded expectations, thanks to the foreshadowing of previous policies, including a series of policies for steady growth, and the continuation of interest rate cuts after the reduction of reserve requirement and monetary easing to stimulate the overall credit demand. At the same time, pay attention to the three characteristics of the structure: 1) in January, the credit supply was concentrated in the enterprise sector, and the improvement of the current corporate loan structure after the bill impulse at the end of last year was realized; 2) The impact of the epidemic and other factors on Residents’ consumer demand is still weak, while the medium and long-term loans of residents dominated by mortgage return to normal. 3) The forward development of finance is expected to drive the improvement of infrastructure and other supporting financing needs.
In terms of the banking sector, since the beginning of the year, the banking index has recorded an increase of 7.5%, ranking second in the primary credit industry, outperforming CSI 300 by more than 13.5pct, mainly due to the clear intention of regulatory steady growth, which is conducive to the decline of credit risk, helps to enhance the market’s expectation of the economy, superimposes the catalysis of the beautiful performance of the bank performance express since the beginning of the year, and the phased switching of capital style. We maintain our previous judgment that the performance of the annual report in March will continue to support the valuation repair of the sector, and individual stocks will continue to be recommended: China Merchants, Ping An, Societe Generale, Ningbo, Chengdu, Hangzhou, Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) .
Risk tips
1. The range and pace of economic restoration are lower than expected;
2. Major operational risks of individual banks, etc.
