Main views on liquidity this week
Directional estimation: the improvement of debt cost is not enough to drive the LPR down by 5bp, and non market factors may be considered in the quotation. Comprehensive standard reduction replacement MLF From the perspective of the reform of deposit interest rate quotation mechanism and the impact of various directional instruments: (1) if the full cost method is adopted, the comprehensive debt cost of the quotation bank has improved by -1.36bp during the last two LPR reductions (April 20, 2020 - December 19, 2021); since the RRR reduction in July (June 20, 2021 - December 19, 2021), the improvement range is 3.80bp. (2) If the marginal cost method is used to calculate, the improvement range of comprehensive debt cost of the quotation bank is 1.57bp from November 20, 2021 to December 19, 2021. Generally speaking, despite various support policies launched by the central bank, if the bank's willingness to reduce LPR quotation is not sufficient based on the principle of commercialization, the cumulative effect of debt cost improvement should not trigger LPR adjustment. For When the MLF interest rate was not adjusted in December, 1y-lpr still decreased by 5bp. We believe that the quotation bank may have considered non market factors in the quotation process, which will also squeeze the net interest margin, so it is necessary to further strengthen the control of debt cost in the future.
It is necessary to adjust the quotation of 5y-lpr. In the current situation, it is more necessary to down regulate 5y-lpr, There are three reasons: (1) the LPR curve has been steep, and the interest margin between 5Y and 1y-lpr has been expanding. China's 5y-lpr quotation contains a strong industrial policy, that is, it undertakes a certain regulation function of the real estate market, but weakens the market-oriented formation mechanism of LPR. (2) The high level of 5y-lpr leads to the heavy burden on the residents of the first set of just needed loans, which may affect the reasonable housing demand of residents. The first set of "just needed" people who buy houses after 2017 is the leading force of stock mortgage loans, and more than 90% of the people are the first set of home buyers. Therefore, the high interest rate of 5y-lpr loans may lead to the first set of "just needed" People are injured by mistake, which may affect the reasonable housing needs of residents. From the perspective of meeting the reasonable housing needs of residents, it is still necessary to reduce 5y-lpr. (3) Stabilizing real estate sales is an important starting point for resolving stock risks and preventing incremental risks at this stage. From the perspective of stabilizing real estate market sales, it is necessary to reduce 5y-lpr to promote sales return to normal and realize the migration of leverage of real estate enterprises to residents.
To stabilize the cost of bank liabilities, there is room for the reduction of Omo interest rate. At present, the interest rate of bank corporate loans is about 4.60%, which has been at a historically low level. The EVA of some enterprise loans is close to 0, and some corporate loans have basically not created economic value, which may reduce the willingness of some banks with high debt cost to provide credit, and are more inclined to allocate bond assets in asset allocation. In the future, the space to benefit the real economy largely depends on the control of debt cost. At the short end of the yield curve, the capital market interest rate with Omo as the benchmark anchor is much higher than the high-quality core deposit interest rate. It is necessary to reduce the cost of comprehensive liabilities of banks by reducing the Omo interest rate and strengthening the limit management of "demand like products" such as call deposits and agreement deposits.
Market impact. From the market reaction after 1y-lpr reduction, both bank stocks and bond markets are generally flat: first, MLF interest rate has not been reduced, and the central bank has no intention to further release easing signals through "price". Second, 5y-lpr has not been adjusted, and there is no "incremental information" in real estate financing. Third, the LPR curve is further steepened, and the expectation of easing again in the short term is weakened. For bank stocks, we believe that the impact of the 1y-lpr reduction on the stock price is relatively limited. The central economic work conference called for the acceleration of the progress of fiscal expenditure. The first batch of 1.46 trillion local government special bonds has been issued, and a package of steady growth policies is being launched. It is expected that the subsequent infrastructure investment is expected to hit the bottom and rebound, which is conducive to the recovery of bank project reserves. The mortgage amount is expected to increase moderately in 2022, the development loan "surfaced", and the process of widening credit is gradually promoted, Good performance of banking stocks. For the bond market, when the MLF interest rate remained unchanged, the LPR reduction did not have a beneficial effect on the interest rate, which was more obvious in the bond market on December 20, and the interest rate fluctuated throughout the day. In the future, we need to pay comprehensive attention to: (1) the deduction of real estate policy and whether 5y-lpr has been adjusted; (2) whether the credit degree will be wide, especially at the beginning of next year.
Risk analysis: the downward pressure on the macro economy is increasing, and the credit easing is less than expected.
