Credit allocation improves quality and efficiency, and financial vitality flows towards the 'real' areas
2024-09-03
The latest Statistical Report on Loan Investment of Financial Institutions in the Second Quarter of 2024 released by the Central Bank shows that by the end of the second quarter, China's RMB loans had increased by 13.26 trillion yuan in the first half of the year. Among them, the growth rate of loans in key areas such as industry, green, and inclusive small and micro enterprises is higher than the growth rate of all loans during the same period. The recently released mid year reports of banks indicate that China's credit structure continues to optimize, focusing on related areas such as the "Five Major Articles", and financial support continues to be strengthened. Looking ahead to future investment, the heads of several listed banks have stated that they will continue to maintain a steady pace of loan growth, focus on optimizing structures in key areas, and strengthen pricing management to provide strong financing support for the recovery and improvement of the real economy. Faced with the current complex and ever-changing internal and external environment, the banking industry is gradually abandoning the single pursuit of scale expansion and focusing on optimizing credit and financing structures. The latest data from the central bank shows that the scale of social financing grew steadily in the first half of the year, with increased support for key areas. Among them, the balance of medium and long-term industrial loans was 23.73 trillion yuan, with a growth rate 9.2 percentage points higher than various loans, and the balance of universal small and micro loans was 32.38 trillion yuan, with a growth rate 8.1 percentage points higher than various loans. The balance of green loans in domestic and foreign currencies was 34.76 trillion yuan, a year-on-year increase of 28.5%, with a growth rate 20.2 percentage points higher than that of various loans. The semi annual report shows that in the first half of the year, the focus of each bank's efforts was mainly on the "five major articles" related fields including technology, green, and inclusive. For example, Industrial and Commercial Bank of China (ICBC) disclosed that it has strengthened high-quality financial services for major strategic, key areas, and weak links, with a growth rate of 13.0% in manufacturing loans, 14.7% in strategic emerging industry loans, 13.7% in green loans, and 21.5% in inclusive loans, all of which are higher than the average growth rate of various loans. The balance of green loans from Agricultural Bank of China exceeds 4.8 trillion yuan, with a growth rate higher than the average growth rate of various loans; Strategic emerging industry loans increased by 527.2 billion yuan, with a growth rate of 25%; Manufacturing loans increased by 287.5 billion yuan, with a growth rate of 12.9%; The annual increment of inclusive small and micro enterprise loans is 599.8 billion yuan, with a growth rate of 24.4%. In response to the real estate loans that the market is more concerned about, the real estate industry loans in the corporate loans of many large banks continue to grow, and the asset quality continues to improve. According to data from the central bank, the balance of real estate development loans in the first half of the year was 13.77 trillion yuan, a year-on-year increase of 2.8%, with a growth rate 1.3 percentage points higher than the end of the previous year. However, the overall housing loans in retail loans are still decreasing. According to the semi annual report, the total balance of personal housing loans in the six major banks decreased by 311.892 billion yuan in the first half of the year. Liu Jiandong, Risk Director of Bank of China, stated that in terms of real estate, since the first half of this year, with the transformation of various policies supporting the stable development of real estate by the government, the external financing environment for real estate enterprises has improved. Next, Bank of China will continue to conscientiously implement various work related to the delivery of guaranteed housing, promote the coordination mechanism of real estate financing and the relevant work of the battle against guaranteed housing, and achieve the goal of fully repaying loans according to the principles of marketization and rule of law; Promote the destocking of existing commercial housing, and support local state-owned enterprises to purchase existing commercial housing for allocation or lease type affordable housing under the premise of legal compliance and controllable risks; Continuously promote the implementation of the "Three Major Projects" and rental housing businesses. What intensity and pace will credit allocation maintain in the second half of the year? The heads of multiple listed banks have stated that they will focus on key areas and make precise efforts to provide strong financing support for the recovery and improvement of the real economy. The management of Industrial Bank of China stated that the focus of credit allocation in the second half of the year is no longer on the scale, but on the quality. "The focus of loan allocation is mainly on optimizing the structure and strengthening pricing management, and will not deliberately pursue growth in scale." "Bank of Communications actively connects with customers' credit needs, and regularly and continuously maintains project reserves." Wang Wenjin, Business Director of Bank of Communications, said that from an industry perspective, reserve projects focus on ten major areas, namely manufacturing, inclusive finance, green development, technological innovation, rural revitalization, infrastructure, energy supply guarantee, livelihood security, transportation logistics, and affordable rental housing. Lin Jingzhen, Vice President of Bank of China, revealed that for the private sector, Bank of China will continue to increase its investment in housing loans, support rigid and improved housing demand, and serve the construction of a new model for real estate development; Actively serving consumer goods through trade in, promoting the expansion and increase of non real estate consumer loans. On the public side, we will further optimize the credit structure, promote loan disbursement in key areas, and increase credit support for fields such as technology finance, green finance, inclusive finance, pension finance, and digital finance. It can be seen that financial institutions have greatly increased their support for small and micro enterprises, green development, and technological innovation in the first half of the year Dong Ximiao, Chief Researcher of the China Merchants Association, predicts that in addition to stabilizing the total amount, smoothing the pace of credit and adjusting and optimizing the structure will be the next focus of work. Banks will actively explore credit demand, scientifically formulate annual credit arrangements, activate existing financial resources, and make financial support for the real economy more sustainable. On the basis of maintaining investment, banks have not relaxed their risk prevention and control measures. Currently, various institutions are increasing their investment in related fields. It is an incremental period, and the related risks have not been fully exposed. At the same time, due to the fact that everyone is increasing their investment and the customer base in related fields is not large, some financial institutions have a situation of excessive customer sinking and excessive reduction in loan prices. "Hu Gang, Vice President of CITIC Bank, bluntly stated that loan concessions are what commercial banks should do, but they must guard against credit risks. This is not only a requirement for the stable development of commercial banks themselves, but also a requirement of the country for commercial banks, reflecting the professionalism and sustainability of commercial banks. "In this regard, China CITIC Bank hopes to achieve fast and good development, not only to ensure a high growth rate of loans, but also to prevent and control risks
Edit：NiChengRan Responsible editor：LiaoXin
Source：Economic Information Daily
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