On March 16, Liu He presided over a meeting of the Financial Commission of the State Council to study the current situation, and the high-level authority set the tone, "actively introducing policies favorable to the market, and prudently introducing contractionary policies."
A major campaign to stabilize finances and reinvigorate the economy began.
Subsequently, the central bank, the Banking and Insurance Regulatory Commission and other five ministries and commissions immediately jointly spoke out to support the healthy development and virtuous circle of the real estate industry.
Zhengzhou, Harbin, Fuzhou, Quzhou, Qinhuangdao and other cities have also opened a new round of rescue actions, and the cancellation of purchase restrictions and sales restrictions has gradually become a trend.
However, for the insurance housing enterprises, it seems that they have not waited for substantial benefits.
Up to now, at least 17 listed real estate companies on the Hong Kong Stock Exchange have failed to issue the 2021 annual report signed by auditors before the deadline of the Hong Kong Stock Exchange, and the ensuing collective suspension of real estate companies is also a rare scene in the industry.
But few people have noticed that recently, there have actually been several major events related to real estate, and to be precise, they are all good news.
01
The first thing, on March 30, the premier presided over the executive meeting of the State Council, which once again stressed that "steady growth should be placed in a more prominent position, the overall plan for stable growth, structural adjustment, and reform should be promoted, and the policies for stabilizing the economy would come out early and quickly, and no measures would be taken to stabilize market expectations, and a plan should be formulated to deal with greater uncertainty."
Compared with the rational expression of the Financial Commission's "active introduction and prudent introduction", the expression of "early out, quick out and out" of the executive meeting highlights the urgency of time and the seriousness of the matter.
The reason behind this is obvious, the outbreak of the geopolitical crisis has led to the sudden severity of the international situation facing China, and the large-scale counterattack of the epidemic in Shanghai, Shenzhen and other economic centers has made the political and economic situation at home and abroad face huge challenges.
Of course, this also means that for the policy side of the real estate industry, there will be no worse news from the central to the local level; if there is good news, then it will soon be heard.
As the ballast stone and stabilizer of China's economy, the real estate industry must play a role at this time.
02
The second thing, on March 30, the Shanghai branch of the central bank formulated and issued the "2022 Shanghai Credit Policy Guidelines", requiring that "financial institutions must not blindly restrict loans, draw loans, break loans, and suppress loans".
"It is necessary to correctly understand and implement the prudent management system of real estate finance, do a good job in financial services for mergers and acquisitions of real estate projects, increase financial support for affordable housing, and help alleviate the housing pressure of new citizens."
The central bank issued the "Guidelines" to financial institutions, which deserves further investigation.
Last year, the overall non-performing loan ratio of the banking industry reached 1.73%, the main reason for which was the rapid increase in the non-performing ratio of public real estate loans.
For example, the non-performing rate of ABC's public real estate loans was 3.39%, 1.58 percentage points higher than the end of the previous year; the non-performing rate of public real estate loans of the Bank of Communications at the end of 2021 was 6.4%, 0.45 percentage points higher than the end of the previous year;
Obviously, the frequent issuance of insurance by real estate enterprises has made the entire banking industry afraid, and banks have long become a common phenomenon in the industry by restricting loans, drawing loans, breaking loans, and pressing loans for housing enterprises.
Now, the central bank is finally going to stop it.
03
Third, on March 30, the China Interbank Market Dealers Association released a registration notice information showing that the dealers association accepted the registration of medium-term notes of Country Garden, Longhu, Yuexiu and other real estate enterprises, with a total registration amount of 25 billion yuan.
The Dealers Association accepted a total of 25 billion yuan in one day, which is obviously very exciting news for housing enterprises.
More critically, Country Garden, Longhu, etc. are all private enterprises, which also marks that after the reopening of bank M&A loans and supply chain ABS to private enterprises, the financing channels of China Ticket have also been reopened to private enterprises.
For many private housing enterprises, this is a good phenomenon, their financing channels are being fully liberalized, and the financing environment is increasingly returning to normal.
According to media reports, Central enterprises and local state-owned enterprises such as Joy City, Poly Development, Poly Real Estate, Jinmao, Gemdale, Beichen Industry, Capital City Development, Nanjing Olympic Sports and other central enterprises and local state-owned enterprises have submitted a total of about 29.5 billion yuan of medium-term notes registration applications.
04
By the way, on March 30, there was another real estate-related matter: real estate stocks ushered in a retaliatory surge on this day.
In the A-share market, the Shenwan real estate sector as a whole rose 5.68%, the largest increase in recent years. Nearly 30 real estate stocks, including Taihe Group, Greenland Holdings, CCCC Group, and Guangming Real Estate, rose and fell, which was spectacular.
In the Hong Kong stock market without restrictions on the rise and fall of the board, Greenland Hong Kong, Sunac China, Shimao Group, Times China, Sunshine 100 and other domestic housing stocks rose by more than 20% in a single day, and more than ten domestic housing stocks such as China Jinmao, Longguang Group, Kaisa, and KWG Taifu rose by more than 10%, which is also extremely rare.
At the same time, the upstream and downstream industrial chain related to real estate has also ushered in a sharp rise, and Oriental Yuhong, Sichuan Jinding and so on have set off a rising tide.
Some people say that it is stimulated by the liberalization of the purchase restriction policy in Fuzhou, and many people say that the rise is inexplicable, but in fact, after reading the above several big things, you can understand the reason.
05
After hearing so much good news, it is time for real estate to warm up next.
The answer should be yes, but it's a little different than ever.
I don't know if everyone has noticed it, the idea of the whole rescue is very clear:
The regulator is to encourage financial institutions to "open the gate and release water" to high-quality housing enterprises, rather than fully open the gate and release water;
The water released by the opening gate is directed to the project of the insurance housing enterprise, and the insured housing enterprise is still the financing gate closed;
The first to benefit from opening the floodgates and releasing water are central enterprises and local state-owned enterprises, and a limited number of outstanding private enterprises enjoy the same treatment.
At present, there do not seem to be many excellent housing enterprises that are favored by financial institutions. For example, the above-mentioned medium-term ticket financing, only Country Garden, Xuhui, Longhu, these three housing enterprises have been accepted.
For another example, among the M&A loans issued by banks, the current amount of M&A loans issued has exceeded 200 billion yuan, but only Country Garden, Xuhui Holdings, Midea Real Estate, New Hope Real Estate and so on have been obtained.
Among them, Country Garden is the most favored, first China Merchants Bank issued 15 billion yuan of M&A financing line to it, and then the Guangdong Branch of the Agricultural Bank of China gave it a credit line of 40 billion yuan, a total of 55 billion yuan.
In fact, Country Garden also successfully issued the first supply chain ABS in the real estate industry this year, and it is still the only two supply chain ABS.
In response to the call of the central government to support real estate, but also to ensure that the money released is absolutely safe, there is not much choice for financial institutions.
As a result, a very small number of high-quality housing enterprises such as Country Garden, Midea Real Estate, Xuhui and Longhu have been affirmed by financial institutions, and their credit ratings have been equated with central enterprises and local state-owned enterprises with official endorsements, which is extremely rare.
06
Compared with the thirst for funds of those insurance housing enterprises, these very few high-quality housing enterprises seem to be more calm and restrained.
Wu Bijun, chief financial officer and vice president of Country Garden, previously said at Country Garden's 2021 results meeting, "At present, the four major banks have shown great support for high-quality housing enterprises in terms of development loans. However, Country Garden will combine its own development and positioning, and continue to maintain its efforts to turn green to the "three red lines", so it will not increase the amount of financing."
Of course, country garden will not increase the amount of financing is a prerequisite.
According to Country Garden's annual report data, as of the end of 2021, Country Garden has a total available cash balance of 181.3 billion yuan.
In other words, Country Garden's funds and financing amount in hand are actually enough, and there are already enough capital safety cushions to protect it.
Of course, the bank issued M&A loans to them, and there is another purpose, which is to encourage these high-quality housing enterprises to participate in the mergers and acquisitions of insurance housing enterprise projects.
For example, Midea Real Estate, after successively obtaining the special quota for M&A loans from China Merchants Bank and Bank of Communications, has successively acquired the project equity of Zhengrong, Jinke and other housing enterprises, which is not only to obtain high-quality projects in "changing positions", but also to help insurance housing enterprises resolve debt risks.
Since the fourth quarter of last year, Country Garden has completed the merger and acquisition arrangement of 35 projects, and about 30 projects have been basically negotiated.
Obviously, the current acquisition projects will bring more lucrative profit returns to the acquirers.
Buffett once said, "I am afraid when others are greedy, and I am greedy when others are afraid." I believe that after experiencing the strongest real estate adjustment in history, excellent housing enterprises will become more excellent.
