On December 24, the monetary policy committee of the people's Bank of China held its fourth quarter regular meeting. Compared with the third quarter, this meeting was held after the continuous reduction of reserve requirements and interest rates in December. The press release combines the latest spirit of the central economic work conference and reflects the more urgent demand for "stable growth":
1) We will increase the combination of cross cyclical adjustment and timely and appropriate counter cyclical adjustment, and strive to stabilize credit growth. Since December, the central bank has strengthened its counter cyclical regulation: ① on December 6, when there was no obvious squeeze on liquidity, the comprehensive RRR reduction released liquidity of 1.2 trillion; ② On December 15, the reduction of MLF was renewed and the cross year capital investment continued to be increased; ③ On December 20, 1y-lpr decreased 5bp to 3.8%; ④ During the period, on December 9, in order to alleviate the pressure of RMB appreciation, it was announced to increase the foreign exchange deposit reserve ratio by 2 percentage points to recover the domestic US dollar liquidity redundancy. It is rare for the central bank to regulate the "three rates" (reserve ratio, interest rate and exchange rate) at the same time in a short time, reflecting the urgent demand for "stable growth" of the economy.
On the other hand, the interest rates of bill discount and rediscount decreased all the way in December, from the 1m period varieties approaching the "0 interest rate" to gradually spreading to the varieties above 6m period, reflecting the weak demand for effective credit and the lack of winter storage projects, so they were forced to use bill business to fill the credit scale and stabilize the credit growth in December. It is worth noting that the interest rate of long-term bills tends to zero, which is inversely linked to the capital cost of banks, which requires banks to pay more costs, and also reflects the serious lack of effective demand. As a leading indicator of economic growth, it is more urgent for the financial system to "steadily put in" credit. On December 16, the central bank held a symposium on the monetary and credit situation of financial institutions. We believe that the top priority is to stabilize the credit growth at the beginning of next year and block the downward cycle of "demand expectation", and the foothold of the early operation of monetary policy should be to stabilize the total demand and release the easing signal.
2) The total amount of monetary policy tools is stable and the structure is strong, and the foothold of "stabilizing credit" is clear. The focus of monetary policy on "stable growth" needs to be clear. Under the condition of relatively stable total investment, the foothold of "stable credit" in 2022 mainly lies in:
① Pratt & Whitney small and micro enterprises should continue to "stabilize the quantity and reduce the price", and large banks are expected to continue to play a "leading role". Structural policy support will not be reduced. In addition to the 300 billion small re loans given in the early stage, the two monetary policy tools directly to the real economy will be transformed into market-oriented policy tools to support inclusive small and micro enterprises and individual industrial and commercial households;
② The investment of green loans has maintained a high growth, and the carbon emission reduction support tool "precision force" is expected to be implemented within this year. It is preliminarily estimated that 500-900 billion yuan of low-cost financial support will be provided in 2021-22. In addition, in the follow-up, 200 billion will support the implementation of special refinancing for clean and efficient utilization of coal;
③ We supported the reasonable demand for housing, increased housing related financing, and the growth rate converged from 8.6% to the growth rate of general loans. In the next stage, it is necessary for the real estate policy orientation to transition from stable financing cash flow to stable sales. The resumption of sales is of great significance for maintaining the normal operation of real estate enterprises. Mortgage loans will "increase in volume and decrease in price", development loans "surface", and even further introduction of non-financial incentives at the sales end can not be ruled out;
④ The effective start of infrastructure investment is the core of stabilizing the economy this winter and next spring. The active fiscal policy of "early start and early effect" will help to promote the realization of good "stable credit" in the first quarter of next year.
Banking sector performance and investment logic: this week, the A-share banking index fell 0.8%, slightly underperforming the CSI 300 index by 0.08pct; Except Zijin (+ 5.3%) and Chengdu (+ 3.3%), the overall performance is weak. At the current time point, we don't have to be pessimistic about bank stock investment. The core driving factors of the bank sector in the next quarter may be: 1) "wide credit" How strong is the push; 2) Whether the risk of real estate enterprises is further fermented. We are relatively optimistic about the above two factors in the first quarter of next year.
Risk tip: it is difficult to reverse the downward pressure on the economy; Real estate risks appear repeatedly.
