Ran Xuedong
html On July 7, the State Council issued a signal to lower the reserve requirement ratio. This is the first time that this round of monetary policy has sent an easing signal since the marginal tightening in early April last year. The yields in the bond market fell sharply and the prices soared. However, the 10-year treasury bond yield continued to decline, falling below 3% at one point.According to common sense, lowering the reserve requirement ratio means changing part of the funds in the statutory reserve account of commercial banks into excess reserve account, alleviating the liquidity pressure of banks, benefiting banks' lending, and being beneficial to banks. Some people say it is to "feed sugar" to the bank.
But yesterday's market was exactly the opposite, with bank stocks falling sharply. The three largest commercial banks with the strongest stock prices: China Merchants Bank fell by more than 5%, Ping An Bank fell by more than 4%, and Ningbo Bank fell by more than 5%. Today, these three stocks continued to fall generally.
market is always correct, which shows that common sense judgment only sees the surface.
Another data today further confirms the market trend. In June 2021, the national consumer price rose by 1.1% year-on-year. A month-on-month decrease of 0.4%. This data is of course affected by the government's early control of rising commodity prices. But more importantly, once commodity prices rise slow down, CPI will come down, indicating that the economy has entered a downward trend again after a brief recovery, and market demand is weak again, which has an adverse impact on the asset quality and lending level of banks.
is actually more fundamental. In the current financial market environment, the reduction of the reserve requirement ratio sounds like a marginal easing in quantity, but the actual effect is more similar to a rate cut. From July 7 to July 8, the State Council issued a voice for lowering the reserve requirement ratio from the first day to today, the interest rate on the ten-year treasury bond has been falling continuously, falling below 3%. There is a slight increase today, but once the expectation of loosening is open, there is still room for interest rate to fall in the future.
Bank stocks rose in the first half of this year. On the one hand, bank stocks fell too much in the early stage and the price was too cheap. After the epidemic was controlled, production and life returned to normal, the asset quality of commercial banks improved, and some banks successfully transformed into light banks that rely on technology and wealth management; on the other hand, it was affected by the positive effects of rising market interest rates.
For Chinese commercial banks, interest rate spread revenue still accounts for the absolute majority of profit . A interest rate cut means a narrowing of interest rate spread income, and a hike means an expansion of interest rate spread income. Since many people are not strong enough in financial management, with the convenience of Internet finance , a large amount of funds are still lying on bank current accounts. The interest rates of these funds are extremely low, but banks can make long-term asset allocations, which is the basis for commercial banks to make profits. Once the interest rate drops, the interest rate on the liability side does not change much, but the interest rate on the asset side drops and the interest rate spread narrows, and the bank's income will also drop.
Looking back, the State Council’s statement on the reduction of reserve requirement ratio this time is that in response to the impact of rising commodity prices on enterprise production and operation, we must maintain the stability and effectiveness of monetary policy on the basis of not flooding the market, and use monetary policy tools such as reserve requirement ratio reduction in time to further strengthen financial support for the real economy, especially small and medium-sized enterprises, and promote a steady decline in comprehensive financing costs.
After the epidemic, the main reason for the rise in commodities was the impact of the epidemic, which led to the misalignment of supply and demand for commodities, and demand has risen, and supply has not kept up. At the same time, in order to support the economy, European and American countries have greatly relaxed in both fiscal and monetary aspects, and prices have risen.
However, the prices of these commodities cannot be transmitted to consumer prices at the same time, which has caused the prices of raw materials for small and medium-sized enterprises to rise, but the prices of finished products have fallen, and both ends are squeezed. Small and medium-sized enterprises have difficulty in operating. The government’s intention is to use monetary policy to directly transmit low-cost funds to small and medium-sized enterprises to alleviate the above difficulties.
But in fact, in the eyes of many market participants, this round of commodity rise has reached its peak, Federal Reserve super loose monetary policy is brewing to withdraw, global economy is facing downward risks again, and demand is not as strong as expected.
So in the case of overall weak demand, the reduction of reserve requirement ratio for small and medium-sized enterprises cannot make up for the narrowing of interest rate spread income caused by banks, and the decline of bank stocks is logical.
