The five directions with high certainty for banks in 2022 include: (1) giving priority to asset allocation efficiency and stable structure; (2) The pace of credit supply is ahead, focusing on new and old infrastructure, inclusive small and micro enterprises, green finance and strategic emerging industries; (3) The reduction of LPR brings pressure on interest rate spread, and banks try their best to maintain stability; (4) Wealth management has been promoted in an all-round way, from extensive to refined; (5) The overall quality of assets was improved, and the risks related to housing and hidden debt were controllable.
On the whole, the annual performance is expected to be highly deterministic and focus on the allocation value.
On February 14th -17, we conducted a centralized survey of some listed banks in China, including 2 large state-owned banks, 1 stock holding companies and 3 city agricultural businesses. The survey involved various assets and liabilities, corporate finance, retail finance, credit approval, risk management and other departments. The survey results show that:
Asset allocation: make progress while maintaining stability and benefit first
(1) the main tone of asset growth is stability. From the perspective of research banks, the arrangement of total asset growth in the business plan initially formulated this year is basically the same as that in 2021. Among them, urban and rural commercial banks in some areas with high economic outlook are relatively more active in asset expansion.
(2) the allocation structure pays attention to the improvement of benefits. According to the survey: ① focusing on credit assets, under the requirement of “stabilizing the total amount of credit”, the loan growth plan of each research bank is basically more than 10%, and most of them are higher than the asset growth plan of the whole bank; ② The structure of bond allocation was optimized. The large banks surveyed said that they would still actively participate in the investment of treasury bonds, local bonds and green bonds this year. The bond allocation of joint-stock banks paid more attention to the stage trend of market interest rates. In addition, the non-standard investment of banks continued to be cautious this year. ③ Interbank assets will be flexibly adjusted according to the capital situation and loan and bond investment.
Credit supply: the total amount is stable, the rhythm is ahead, and the focus is prominent
(1) stable total amount: according to the survey, the major banks plan to keep the loan growth matched with the growth rate of social finance during the year. The scale increment during the year is expected to be the same as that of last year, and the investment of urban and rural commercial banks in some prosperous regions is more positive under the guidance of supervision.
(2) front rhythm: according to the survey of large banks, the quarterly delivery in previous years followed the rhythm of “3322”, while the attitude in the first quarter of this year was more positive; Since the Commercial Bank launched the loan early, it has benefited from the “early investment” of the commercial bank and the trend of interest rate.
(3) structural optimization: more choice of policy guidance and market demand direction for public and retail credit:
The focus of corporate credit is prominent: in terms of industry, the investment of the surveyed large banks is mainly anchored in the fields of new and old infrastructure, inclusive small and micro enterprises, green finance and strategic emerging industries, while joint-stock banks and urban rural businesses will still promote around their own strategic characteristic fields; In terms of region, the bank focuses on national strategic regions such as Beijing Tianjin Hebei, Guangdong Hong Kong Macao Bay area, Yangtze River Delta, Chengdu and Chongqing.
Retail credit focuses on non mortgage personal loans: in terms of mortgage, the surveyed banks will still focus on the supervision of loan concentration, strengthen the demand for first and improved housing, and pay more attention to the real estate enterprises and project qualifications in the access of first-hand housing mortgage; In terms of non mortgage, consumer credit and inclusive small and micro enterprises have basically become the focus of banks’ efforts this year. Among them, large banks tend to online varieties of highly qualified customers, and some characteristic banks will also expand the scope and capacity circle of offline business.
Debt strategy: improve the balance of deposit volume and price, and take the initiative to optimize the debt structure. Overall, thanks to the promotion of deposit supervision and the optimization of internal structure, the volume price balance of debt management of the surveyed banks in 2022 is expected to be consolidated:
(1) deposit volume and price are expected to improve: according to the survey banks, since the central bank optimized the method of determining the self-discipline upper limit of deposit interest rate in June last year, the deposit interest rate has shown a trend of steady improvement, and the above trend is expected to continue this year. Some major banks also fed back that if the deposit reform is further promoted or deepened, the deposit interest payment level is expected to further decline. In addition, since last year, all banks have taken the initiative to continuously reduce high interest rate deposits and long-term limited deposits, and further promote the optimization of deposit pricing.
(2) optimization of active debt structure: considering the improvement of deposit volume and price, some banks feedback that the use of inter-bank debt instruments will be more flexible this year, especially in the selection of issuance scale and term structure of various bonds, inter-bank certificates of deposit and other instruments in combination with the market interest rate.
Interest margin: facing downward pressure, structural adjustment is expected to stabilize marginally (1) asset side: the pricing of newly issued loans is downward. Affected by factors such as LPR reduction and regulatory guidance for financial entities to transfer profits, the research banks generally feedback that the interest rate of new loans has downward pressure. In response to this pressure, some banks said they would seek to improve the credit structure and improve the pricing level. Specific measures include increasing the proportion of retail loans, increasing the proportion of credit loans and credit sinking.
(2) liability side: deposit cost is controllable. There is still market competition pressure on banks to absorb deposits, and the trend of “regular and long-term” deposits is difficult to reverse. However, the self-discipline mechanism of deposit interest rate and the downward trend of interest rate center offset the upward pressure of interest payment rate to a certain extent, and the overall deposit cost is controllable. Some surveyed banks said they would flexibly optimize the debt structure by taking advantage of the market opportunity with relatively low inter-bank debt cost, and the interest payment rate is expected to continue to improve slightly.
Generally speaking, the asset pricing of the surveyed banks tends to decline, the debt cost is relatively controllable, and the overall interest margin is facing downward pressure. Seeking further improvement in the asset negative structure in the business strategy in 2022 is expected to stabilize the margin of interest margin.
Intermediary business: wealth management continues to deepen
According to the general feedback of the surveyed banks, they will continue to focus on wealth management business and make efforts in multiple dimensions such as products, customer groups and channels, resulting in the continuous improvement of key indicators such as intermediate business income and AUM.
(1) products: enrich the product matrix. According to the survey, many banks regard enriching the product system as an important layout of wealth management business, have an open attitude towards products, combine their own development with the introduction of external products, and some mature financial subsidiaries continue to improve their product management and creation capabilities to empower the parent bank.
(2) customer base: give full play to resource endowment and business characteristics. In terms of customer base expansion, many banks said they would expand customers in combination with their own customer base resource endowment and business characteristics, and the surveyed large banks would promote high-end on the basis of high customer base; Urban Rural Commercial Bank focuses on the deep excavation of characteristic customer groups.
(3) channel: online and professional system construction. In terms of channel construction, many banks mentioned improving the construction of sales system. On the one hand, they increased scientific and technological investment and used intelligent system to sell online auxiliary products to improve the efficiency of financial managers; On the other hand, strengthen the construction of offline marketing team and create professional services.
Risk research and judgment: risk indicators continue to improve, and risks in key areas are controllable (1) asset quality is stable. Although there are still disturbing factors such as the rebound of the epidemic and economic pressure in the external environment in 2022, on the one hand, the macro “stable growth” policy is conducive to economic recovery; On the other hand, since the outbreak, banks have continued to optimize risk management and control and gradually cleared the stock risk. The survey banks generally feed back that the asset quality is expected to remain stable during the year.
(2) the provision policy remained stable. According to the situation of the research bank, the provision policy is in the same direction as the risk situation. Under the expectation of stable operation of asset quality, the provision is expected to remain basically stable.
(3) risks in key areas such as real estate and urban investment platform are controllable. According to the survey: ① the default risk of real estate has increased to a certain extent, but the overall risk is controllable. According to the surveyed banks, the business scale of real estate enterprises involved in risks is small and the current repayment situation is still under control; The main business areas of Chengnong commercial banks are basically located in economically developed cities, with high overall asset quality and safety; ② There are risks in individual areas of the urban investment platform, and the overall impact is limited.
According to the surveyed major banks, there are hidden risks in the implicit debt of some regional urban investment platforms, but the relevant banks continue to do a good job in troubleshooting and control, and the risk is controllable; The related businesses of Chengnong commercial bank are small and basically located in developed areas, and the asset quality is basically not affected.
Risk factors: the macroeconomic growth rate dropped sharply, and the quality of bank assets deteriorated beyond expectations.
Investment perspective: the survey shows that the bank’s asset liability allocation strategy in 2022 will seek to make progress while maintaining stability, advance the pace and focus of credit supply, and highlight the green, inclusive and other fields guided by supervision. The interest margin is under slight pressure, and the further improvement of asset negative structure is expected to stabilize the margin of interest margin. The asset quality is expected to be stable and good, and the risks in key areas such as real estate and urban investment platform are controllable. It is expected that the annual performance is highly deterministic. It is recommended to pay attention to the annual dimensional allocation value. The investment portfolio is: China Merchants Bank Co.Ltd(600036) , Ping An Bank Co.Ltd(000001) , Industrial Bank Co.Ltd(601166) , Postal Savings Bank Of China Co.Ltd(601658) , Bank Of Jiangsu Co.Ltd(600919) and Bank Of Nanjing Co.Ltd(601009) .
