Event: according to the preliminary statistics of the people's Bank of China, social finance increased by 4.65 trillion yuan in March 2022, an increase of 1.27 trillion yuan year-on-year. As of March 2022, the stock of social finance was 325.64 trillion yuan, with a cumulative year-on-year increase of + 10.6% and the previous value of + 10.2%; In March 2022, RMB loans increased by 3.13 trillion yuan, an increase of 400 billion yuan year-on-year; In March 2022, M0, M1 and M2 were + 9.9%, + 4.7% and + 9.7% respectively year-on-year, and + 4.1pcts, + 0pcts and + 0.5pcts respectively compared with the previous month.
Core view:
New social finance exceeded market expectations, and credit and government bonds were the main contributions
In March 2022, the increment of social finance was higher than the market expectation, and the stock of social finance was + 10.6% year-on-year. After falling last month, it returned to the upward track. Structurally, social finance increased year-on-year in February, with credit, government bonds and off balance sheet contributing. Credit and government bonds are the main contributions, which generally reflects the relatively positive bank lending, the financial force and the reduction of off balance sheet pressure drop. According to the data of the first March of this year, the new social finance in 2022q1 has reached a high point since 2017, and the credit expansion has achieved certain results in terms of volume.
RMB loans increased, but the structure was poor
In March, RMB loans increased by 3.13 trillion yuan, an increase of 400 billion yuan year-on-year. In the long and short term, medium and long-term loans increased by 235.6 billion yuan less than the same period last year, and short-term loans and bill financing increased by 765.9 billion yuan more than the same period last year. In terms of residents and enterprises, short-term loans and medium and long-term loans at the residential end increased by 139.4 billion yuan and 250.4 billion yuan respectively year-on-year, short-term loans at the enterprise end increased by 434.1 billion yuan year-on-year, and medium and long-term loans increased by only 14.8 billion yuan year-on-year. Overall, the amount of new people's loans recovered in March, but the structure is still poor. The demand for medium and long-term loans of residents and enterprises is not strong. Credit is mainly supported by short-term loans and bill financing of enterprises.
The epidemic affected consumption and the operation of small and micro enterprises, as well as the low willingness of residents to buy houses, which dragged down the credit of residents' departments. In March, residents' medium and long-term loans and short-term loans both fell. The main reasons are as follows: 1. Under the epidemic and strict prevention and control policies, consumption was restrained and residents' demand for short-term loans could not be released. 2. Under the epidemic situation, small and micro enterprises are difficult to operate, self-employed households tend to be cautious in investment, and the motivation to borrow money to expand the scale is insufficient. 3. Since the beginning of the year, although there have been frequent house purchase stimulus policies, residents' willingness to buy houses has always recovered slowly, and the corresponding housing loan growth is still weak.
The total amount of enterprise loans is strong and the structure is weak. The weak expectation of manufacturing enterprises and the real estate recession are the core contradictions at present. In March, the short-term loans and bill financing of enterprises increased by 434.1 billion yuan and 471.2 billion yuan respectively year-on-year, and the medium and long-term loans increased by only 14.8 billion yuan year-on-year. The main reasons for the strong total amount and weak structure of enterprise loans are as follows: 1. In the case of real estate risk exposure and the increase of uncertainty in the spread of the epidemic, banks have a greater need to fill loans with tickets in order to achieve the goal of "wide credit". This trend is reflected in the continuous decline of the discount rate of state-owned bank notes. 2. Under the epidemic, the cash flow of enterprises has been affected to a certain extent. In order to maintain the operation of enterprises, enterprises have a large demand for short-term financing. 3. Under the continuous depression of the real estate industry and the storm of real estate enterprises, the real estate's pull on credit has been significantly weakened. 4. With the persistence of international geopolitical conflicts and the spread of China's epidemic, the expectation of manufacturing enterprises has weakened, affecting the willingness of medium and long-term financing.
Other important sub items of social finance except credit: off balance sheet bills and government bonds made a great contribution to the year-on-year increase of social finance
In March 2022, corporate bond and stock financing increased less year-on-year, and contributed less to the year-on-year increase of social finance. Government bonds increased by 392.1 billion yuan year-on-year, mainly due to the accelerated issuance of government bonds under the advance force of finance. The decrease of 153.2 billion yuan in new trust loans is mainly due to the fact that last year was the last year of the transition period of the new asset management regulations. This year, the pressure drop of trust loans has decreased significantly. The new undiscounted bills increased from 229.6 billion yuan in the same period last year to 28.6 billion yuan in March this year. The base effect of last year also contributed to the year-on-year increase of new social finance in March.
The growth rate of M1 was flat, while the growth rate of M2 was upward
In March, M1 was + 4.7% year-on-year, unchanged from the previous month, and M2 was + 9.7% year-on-year, up from the previous month + 0.5pcts. The rebound of M2 growth rate may be mainly due to the transformation of government deposits into residents' and enterprises' deposits under the forward force of Finance (government deposits decreased by 842.5 billion yuan in March 2022), and the increase of residents' willingness to save out of caution under the epidemic. With the growth rate of M1 unchanged and the growth rate of M2 rising, the difference between M1 and M2 in March decreased compared with the previous month, and the degree of currency activation decreased, which may reflect the relative lack of motivation for enterprise production and expansion under the increase of expected uncertainty.
Outlook: the total amount of financial data has stabilized and the structure is poor. The follow-up monetary and credit policies may continue to work
Since March, the spread of the impact of international geopolitical conflicts and the significant intensification of the epidemic in China have posed all-round pressure on China's economic operation in the short term. China's economy is still under the triple pressure of shrinking demand, supply shock and weakening expectations. Premier Li Keqiang presided over the executive meeting of the State Council on April 6 and set the tone again that the economic situation was grim. In this situation, the relatively bright social finance data in March is a boost to market confidence. However, while the total amount stabilizes, it should also be noted that the data structure of social finance is still poor, reflecting the core obstacles still existing in the continuous promotion of wide credit: first, under the real estate recession, the demand for residents' housing loans and medium and long-term loans of real estate enterprises has been suppressed, and the pulling action on social finance is weak; Second, the spread of the epidemic and the continuation of overseas geographical conflicts affect the medium and long-term confidence of enterprises, and the demand for medium and long-term operational loans is insufficient. At present, the epidemic is still spreading, and there is still great uncertainty in overseas geographical conflicts. The decline in the yield of 10-year Treasury bonds since the end of March also reflects the increase of downward pressure on the economy and the increase of expectations of monetary easing. In this case, we believe that the further relaxation of the follow-up real estate policy and the further introduction of the total easing policy are still worth looking forward to.
