Core view
The financial sector supports the manufacturing industry mainly through structural policy tools to realize the role of targeted regulation and precise drip irrigation. The main support methods are as follows: 1. Give full play to the structural guiding role of credit policy, such as adding special indicators for medium and long-term loans and credit loans in the MPA system, and continuously improving the assessment intensity. The CBRC issued a document to strengthen the regulation of credit structure, so as to realize the rapid growth of medium and long-term loans in the manufacturing industry; 2. Credit policy supports high-tech manufacturing in multiple dimensions; 3. Create a monetary policy tool for carbon emission reduction to provide financial support for areas with carbon emission reduction effects, most of which are manufacturing enterprises; 4. Take multiple measures to support private small and micro enterprises, such as increasing the rediscount amount of special refinancing, reducing the rediscount interest rate of refinancing, and creating monetary policy tools directly to entities. We believe that the follow-up policies in the financial sector will continue to focus on supporting the manufacturing industry. Under the background of the steady growth of new manufacturing, the investment in the manufacturing industry is expected to be the worst expected this year, and the annual growth rate is expected to reach 11.1%.
Manufacturing industry is the real embodiment of the health of the real economy, but its credit demand has not been effectively met for a long time
China's economy is transforming from a high-speed growth stage to a high-quality development stage. Economic development has entered a new normal. We pay more attention to structural optimization, transformation and upgrading, and strive to improve the quality and efficiency of economic development. Compared with infrastructure and real estate investment dominated by counter cyclical policies, the improvement of manufacturing investment needs to rely on the endogenous power of the real sector, that is, it must be driven by real profits, downstream demand or supply shortage. Manufacturing investment is the real embodiment of the health of the real economy. Finance is the blood of the real economy. In the process of China's economic transformation and upgrading, the demand for financial services of the real economy, especially the manufacturing industry, is also increasing. However, from the perspective of capital profit seeking and bank profitability, in the transmission process of traditional central bank quantitative regulation tools, commercial banks often prefer infrastructure and real estate fields with less risk and higher overall return on investment, rather than effectively flowing into the manufacturing industry, When the credit demand of manufacturing industry is not effectively met and the liquidity of monetary policy overflows, the manufacturing industry can get relatively sufficient financial support.
Financial support for manufacturing is mainly through structural instruments rather than aggregate instruments
Due to the weak direct transmission of aggregate policy tools, in the past, the support of policies in the financial field to the manufacturing industry was mainly through structural tools to achieve targeted regulation and precise drip irrigation. The main support methods are as follows: 1. Give full play to the structural guiding role of credit policies, such as adding special indicators for medium and long-term loans and credit loans in the manufacturing industry within the MPA system, continuously improving the assessment intensity, and the CBRC issued a document to strengthen the regulation of credit structure, so as to realize the rapid growth of medium and long-term loans in the manufacturing industry; 2. Credit policy supports high-tech manufacturing in multiple dimensions; 3. Create a monetary policy tool for carbon emission reduction to provide financial support for areas with carbon emission reduction effects, most of which are manufacturing enterprises; 4. Take multiple measures to support private small and micro enterprises, such as increasing the rediscount amount of special refinancing, reducing the rediscount interest rate of refinancing, and creating monetary policy tools directly to entities.
Give play to the structural guiding role of credit policies, such as MPa assessment of the proportion of medium and long-term loans in the manufacturing industry
In 2019, the two sessions were the first to set the policy tone for credit support to the manufacturing industry. The government work report of that year clearly stated that "we should encourage the increase of medium and long-term loans and credit loans to the manufacturing industry. This year, the loans of small and micro enterprises of large state-owned commercial banks should increase by more than 30%. The Politburo meeting in July 2019 once again emphasized "guiding financial institutions to increase medium and long-term financing for manufacturing and private enterprises". Later, the second quarter monetary policy implementation report of the central bank clearly proposed to innovate and improve monetary policy tools and mechanisms and guide financial institutions to increase medium and long-term financing for manufacturing and private enterprises. Under the national tone, in the first quarter of 2019, the central bank added special indicators for private enterprise financing, small and micro enterprise financing, medium and long-term loans and credit loans in the MPA system to increase the encouragement and guidance of MPA in small and micro enterprises, private enterprises and other fields. In the first quarter of 2020, we will further improve the assessment weight of the financing of small and medium-sized micro enterprises, private enterprises and manufacturing industry in the MPA system. In the first quarter of 2021, we will continue to dynamically adjust and optimize relevant assessment indicators and guide financial institutions to continue to increase their support for the medium and long-term financing of inclusive small and micro enterprises and manufacturing industry.
We believe that by adding special indicators or increasing the assessment weight in the MPA system, we can effectively realize the directional guidance of credit, superimpose the three red lines of real estate enterprises and the concentration management of real estate loans, and reduce the credit supply in the real estate field, which is also conducive to the flow of funds into the manufacturing industry.
In addition to MPa assessment, the CBRC also actively cooperated with the central bank's credit policy and issued documents to guide banks to increase financial support for manufacturing industry. In April 2021, the China Banking and Insurance Regulatory Commission issued the notice on doing a good job in manufacturing financial services in 2021, requiring to increase the credit supply of manufacturing industry and strengthen financial services in key areas (increasing the proportion of manufacturing loans, etc.); Improve the quality of financial supply in manufacturing industry; At the same time, we are determined to improve the credit and performance evaluation mechanism of the manufacturing industry, and give full play to the role of "giving priority to the credit and performance evaluation" of the manufacturing industry.
The effect of policy focused support is remarkable. In recent years, the growth rate of medium and long-term loans in China's manufacturing industry has increased significantly, significantly higher than the overall credit growth rate. At the end of 2020, the balance of medium and long-term loans in the manufacturing industry increased by 35.2% year-on-year, more than 20 percentage points higher than 14.9% at the end of 2019, and significantly higher than 12.8% of the overall credit growth; At the end of 2021, the growth rate was 31.8%, maintaining a high level of more than 30%, of which the medium and long-term loans for high-tech manufacturing industry increased by 32.8% year-on-year. Different from the short-term capital turnover of enterprises corresponding to short-term loans, medium and long-term loans correspond to the medium and long-term capital expenditure of enterprises. The increase in the growth rate of medium and long-term loans has more significantly driven the investment in new production capacity and plant construction. The financial support in the past two years has provided financial guarantee for the rapid growth of manufacturing investment.
Credit policies support high-tech manufacturing in multiple dimensions and promote industrial upgrading
A number of relevant documents have been issued at both the national and local levels, referring to the strengthening of targeted financial support for high-tech manufacturing. On March 22, 2021, the central bank held a symposium on the optimization and adjustment of credit structure of 24 major banks in China, emphasizing further increasing support for scientific and technological innovation and manufacturing industry, increasing the proportion of manufacturing loans and increasing the credit supply of high-tech manufacturing industry. The notice on doing a good job in manufacturing financial services in 2021 issued by the CBRC in April 2021 clearly proposed to increase the independent and controllable financial support for advanced manufacturing, strategic emerging industries and industrial chain supply chain, and promote the optimization and upgrading of the whole industrial chain and the tackling of key core technologies. In addition, the China Banking and Insurance Regulatory Commission issued the guidance on the support of the banking and insurance industry for high-level scientific and technological self-reliance and self-improvement in December, requiring relevant institutions to actively support the innovative development of high-tech enterprises and "specialized and special" small and medium-sized enterprises, so as to maintain the reasonable growth of medium and long-term loans in high-tech manufacturing industry. At the local level, in July 2021, Chongqing banking and insurance regulatory bureau took the lead in issuing the "several measures of Chongqing Finance to support the high-quality development of manufacturing industry", proposing to "increase the credit supply of medium and long-term loans for manufacturing industry, focusing on increasing the medium and long-term financial support for advanced manufacturing industry, high-tech manufacturing industry and strategic emerging industries". In March 2022, the central bank and other four departments and the Zhejiang Provincial People's Government jointly issued the opinions on financial support for high-quality development in Zhejiang and the construction of a demonstration area of common prosperity, and put forward policies to improve the scientific and technological innovation ability of financial services, strengthen financial support for advanced manufacturing, including improving financial services for strategic emerging industries, advanced manufacturing and "specialized and special" enterprises, and increasing financial support for the supply chain of advanced manufacturing.
The central bank encourages and guides commercial banks to set up new manufacturing credit products to support scientific and technological innovation and industrial upgrading. In recent years, the central bank has promoted banking financial institutions to list the scale of loans for scientific and technological innovation and technological transformation of manufacturing industry, implemented preferential internal capital transfer prices, and appropriately improved risk tolerance. According to our calculation, the manufacturing loan balance of the six state-owned banks in 2021 was 7.36 trillion yuan, an increase of 664204 billion yuan compared with 2020, and the manufacturing non-performing loan ratio (weighted average) was 3.83%, a decrease compared with 2020.
From the practice of commercial banks, a variety of innovative credit products have been established, such as technology upgrading support loans, fixed asset purchase loans for large and medium-sized enterprises, science and innovation loans, etc., which generally show the following characteristics.
First, precision services for scientific and innovative small and micro enterprises. National high-tech enterprises, science and technology enterprises recognized (filed) by the science and Technology Department of the government at or above the prefecture level, or science and technology enterprises founded by science and technology leading talents evaluated by the government unit at or above the prefecture level can be handled.
Second, fully rely on public credit information. Relying on the credit information disclosed by the national public credit information center in the fields of justice, taxation and customs, it is used in various links such as pre loan access, in loan audit and post loan management. There is no need for mortgage and government guarantee to increase credit, so as to provide convenient financing services for small and micro science and innovation enterprises with light capital and good credit.
Third, introduce government financing guarantee. The government financing guarantee system constructed by the national financing guarantee fund provides credit enhancement and effectively improves the financing amount of small and micro enterprises.
Policy financial institutions give priority to supporting advanced production capacity construction and technological transformation
Policy financial institutions give priority to supporting the construction of advanced production capacity, scientific and technological research and development, industrialization and technological transformation, so as to help enhance the core competitiveness of the manufacturing industry and realize the new energy and intelligence of the industry.
Take CDB Suzhou Branch as an example, set up a special business department to serve the key industrial chain of Jiangsu Province. At the end of 2021, the balance of the bank's manufacturing loans reached 958.8 billion yuan, with a new increase of more than 100 billion yuan in that year. The medium and long-term loans of the manufacturing industry accounted for 85%, ranking first in the local financial industry. In 2021, we will support key manufacturing enterprises in various fields in Suzhou to strengthen and supplement their chains, promote the development of industrial clusters such as electronic information, equipment manufacturing, biomedicine and advanced materials, and issue 12.3 billion yuan of manufacturing loans. In addition, Suzhou Branch of taixuecang science and Technology Research Co., Ltd. issued various types of innovative loans of RMB 13 billion to Suzhou Branch of taixuecang community, and other key carriers of industrial and educational integration.
Create monetary policy tools for carbon emission reduction and boost manufacturing investment
In November 2021, the central bank launched a carbon emission reduction support tool and a special refinancing of 200 billion yuan to support the clean and efficient utilization of coal to support the low-carbon transformation and development of the economy. For carbon emission reduction tools, the people's Bank of China provides low-cost financial support to financial institutions at 60% of the loan principal, focusing on the three areas of carbon emission reduction: clean energy, energy conservation and environmental protection and carbon emission reduction technology. In February this year, the national development and Reform Commission and other national ministries and commissions jointly issued the guidelines for the implementation of the transformation and upgrading of energy conservation and carbon reduction in key areas of high energy consuming industries (2022 version), which emphasizes guiding the transformation and upgrading of key high energy consuming industries and strengthening technological research, and issued the implementation guidelines for the transformation and upgrading of 17 key industries, including the oil refining industry, ethylene industry and modern coal chemical industry. We believe that the credit demand in the field of carbon reduction in traditional industries will increase significantly in the future, The main body of carbon emission reduction tool loans is likely to expand from new energy enterprises to all energy-saving and emission reduction enterprises, providing financial support for the transformation and upgrading of traditional manufacturing industries. The promotion of double carbon is a long-term process. The carbon emission reduction support tools will continue to play a structural guiding role, and the scale is expected to increase gradually. According to the official disclosure of the central bank at the end of last year, it issued the first batch of carbon emission reduction support tool funds of 85.5 billion yuan to relevant financial institutions, and supported financial institutions to issue qualified carbon emission reduction loans of 142.5 billion yuan, a total of 2817 enterprises, driving about 28.76 million tons of carbon emission reduction. We combed the data of carbon emission reduction loans from July to December 2021 disclosed by major banks in mid February. The total carbon emission reduction loans of 15 banks from July to December 2021 were about 226.1 billion, which has been converted into central bank funds of about 135.65 billion.
Take multiple measures to support private small and micro enterprises
The proportion of private small and micro enterprises in the manufacturing industry is high. By the end of 2021, the proportion of private investment in manufacturing investment was as high as 86.2%, while that in infrastructure investment was only 19.4%. Multiple policies and measures were taken to alleviate the problem of difficult and expensive financing of small and medium-sized enterprises, and also help maintain the stability of manufacturing investment. For example: 1) the annual inclusive financial targeted RRR reduction mechanism and several targeted RRR reductions for small and micro enterprises;
2) after the covid-19 epidemic in 2020, the state issued a series of policies to support the expansion of domestic demand, help the resumption of production and promote the development of small, medium-sized and micro enterprises: arrange 300 billion yuan of special refinancing in three batches, 500 billion yuan of refinancing and rediscount line, and 1 trillion yuan of refinancing and rediscount line, totaling 1.8 trillion yuan, to support the development of real economy such as anti epidemic insurance, resumption of work and production and small, medium-sized and micro enterprises, In 2022, there will be two policies to support the normalization of capital and interest repayment of direct loans to small enterprises, namely, the extension of direct monetary policy and direct repayment of interest to small enterprises. In September 2021, the amount of small refinancing increased by 300 billion yuan again.
3) in June 2020, the people's Bank of China, the China Banking and Insurance Regulatory Commission and other eight departments issued the guiding opinions on Further Strengthening the financial services of small and medium-sized micro enterprises (Yin Fa [2020] No. 120) and put forward a number of support policies. The policies in the financial field mainly include: arranging the extension of repayment of principal and interest of loans to small and medium-sized micro enterprises; Give full play to the leading role of national banks, and the loan growth rate of inclusive small and micro enterprises of five large state-owned commercial banks is higher than 40%; Make good use of the refinancing and rediscount policy; Implement the special credit line of development and policy banks. Development and policy banks should put in place the special credit line of 350 billion yuan by the end of June 2020, and support the resumption of work and production of small, medium-sized and micro enterprises with preferential interest rates; Increase insurance support and encourage insurance institutions to provide relevant loan guarantee insurance products with strong pertinence according to the specific situation of small, medium-sized and micro enterprises affected by the epidemic; Significantly increase credit loans, initial loans and renewal of loans without principal repayment for small and micro enterprises; Clean up and standardize unreasonable and illegal financing charges; Give full play to the financing support role of multi-level capital market, including increasing the financing support of bond market, improving the financing efficiency of small, medium-sized and micro enterprises using commercial bills, and supporting high-quality small, medium-sized and micro enterprises to be listed or listed for financing; Support the development of supply chain financial services for small, medium-sized and micro enterprises.
4) on April 8, 2022, the general office of the CBRC issued the notice on further strengthening financial support for the development of small and micro enterprises in 2022 (ybjf [2022] No. 37), Emphasize the work objective of "banking financial institutions generally continue to achieve the goal of 'two increases' of inclusive small and micro enterprise loans with a single credit of less than 10million yuan (inclusive), that is, the growth rate of such loans is not lower than the growth rate of various loans, and the number of households with loan balance is not lower than the level at the beginning of the year", and put forward a number of implementation policies.
5) relevant interest rate policies ease the pressure on financing costs of small, medium-sized and micro enterprises. We will continue to deepen the market-oriented reform of interest rates, and guide the decline of enterprise loan interest rates through interest rate or reserve requirement reduction, especially the reduction of small refinancing interest rates and rediscount interest rates for agricultural support, so as to provide targeted support to small and micro enterprises. In 2021, the weighted average interest rate of Chinese enterprise loans was 4.61%, the lowest level in more than 40 years of reform and opening up. In 2021, the weighted average interest rate of newly issued Pratt & Whitney small and micro enterprise loans was 4.93%, compared with 20%
