In the era of comprehensive net worth of wealth management, the trend of inter-agency differentiation has intensified. With the successive disclosure of bank annual reports, the operation of various wealth management subsidiaries has also surfaced.
Judging from the data, the pressure on the banking industry to collect business has been further confirmed. According to the financial report, the first financial reporter combed that 9 of the 14 wealth management subsidiaries whose parent bank has disclosed data have declined in net profit, and 3 of them have halved their profits, including two large state-owned banks, ABC Wealth Management and CCB Wealth Management, and China Post Wealth Management's profit last year also fell by more than three percent.
From the perspective of the scale of existence, there are currently 13 wealth management companies with comparable data, and the balance of wealth management products has shrunk by more than 270 billion yuan, of which 7 have declined year-on-year. Among the wealth management subsidiaries of large banks, except for Bank of Communications Wealth Management, the scale of the other five wealth management subsidiaries has decreased to varying degrees. In contrast, the scale of the wealth management sub-scale of joint-stock banks is "more resistant", however, as a leader in the industry, CMB Wealth Management has ended its profit growth trend since its establishment, and its scale and net profit have both declined.
14 wealth managers made 5 billion less money, and 3 made half the profits
Since the opening of the first wealth management subsidiary in May 2019, the wealth management subsidiary has continued to grow and gradually become the main force in the wealth management market under the new asset management regulations. Up to now, 32 wealth management subsidiaries have been approved for establishment, including 6 state-owned banks, 12 joint-stock banks, 8 urban commercial banks, 1 rural commercial bank, and 5 joint venture banks, all of which have been opened except for Zhejiang Bank Wealth Management (approved for establishment at the end of 2023).
In the past two years, while wealth management has become fully net-worth, the impact of the adjustment of the stock and bond market and the change of investors' risk appetite on the wealth management market has been further highlighted, and the supporting role of relevant fee income on bank income has been weakening. Reflected in the operating data of wealth management subsidiaries, the trend of inter-agency differentiation has intensified.
At present, among the 14 wealth management companies that have disclosed their 2023 results with the financial report of the parent bank, in addition to the wealth management subsidiaries of the six major state-owned banks, there are also 6 wealth management subsidiaries of joint-stock banks such as CMB Wealth Management and IB Wealth Management, 1 wealth management subsidiary of urban commercial banks, and 1 wealth management subsidiary of rural commercial banks. Among them, 9 companies had a negative net profit growth rate, accounting for more than 60%, and 8 of them had a double-digit decline.
Last year's net profit decreased by 54.67% and 53.42% year-on-year respectively, from 3.523 billion yuan and 2.840 billion yuan to 1.597 billion yuan and 1.323 billion yuan, and the number of seats also fell out of the top three. China Post Wealth Management's net profit also decreased by nearly 34% last year, from 1.271 billion yuan to 841 million yuan.
Among the wealth management subsidiaries of other major banks, the net profit of Bank of China Wealth Management also decreased by 12.19% year-on-year to 1.628 billion yuan. ICBC Wealth Management and BOCOM Wealth Management achieved positive profit growth, but the net profit growth rate of ICBC Wealth Management was 7.2% lower than that of previous years, while BOCOM Wealth Management increased by 4.39% against the trend, better than the 2.86% performance of the previous year.
Among the other wealth management subordinates whose net profit fell "eye-catching" was Chongqing Rural Commercial Wealth Management, a subsidiary of the head rural commercial bank, whose net profit fell by 52.51% to 170 million yuan last year, which was also cut in half. At present, Qingyin Wealth Management, the only city commercial bank wealth management subsidiary that has disclosed its performance, also saw a decline of more than 13% in profit last year.
Among the wealth management subsidiaries of joint-stock banks, although CMB Wealth Management continued to rank among the "most profitable wealth management subordinates" with a net profit of 3.190 billion yuan, its profit also decreased by 11.22% last year, ending the positive profit growth since its establishment in 2019, with IB Wealth Management (2.582 billion yuan) and CNCBI Wealth Management (2.255 billion yuan) ranking second and third respectively, with the former's net profit falling by 17% and the latter increasing by 10.11%. The net profit of Ping An Wealth Management and Everbright Wealth Management was up and down, temporarily ranking fourth and fifth with net profits of 1.885 billion yuan and 1.764 billion yuan respectively.
From the perspective of overall profitability, the total net profit of the wealth management subsidiaries of the above 14 banks last year was 21.251 billion yuan, nearly 5 billion yuan less than that in 2022, a decrease of nearly 19%. Among them, the number of institutions with a net profit of more than 2 billion yuan has decreased from 5 in 2022 to 3.
The scale fell more and rose less, and the cash allocation was greatly increased
Scale is still an important competitive indicator for asset management institutions. According to the 2023 annual report of the wealth management market disclosed by China's wealth management network, as of the end of last year, the scale of existing products in the wealth management market was 26.80 trillion yuan, although it has rebounded compared with the first half of 2023, it still decreased by 3.10% year-on-year for the whole year, which is the second consecutive year of scale decline.
Among them, 31 wealth management companies have 19,400 existing products, with an existing scale of 22.47 trillion yuan, accounting for 83.85% of the total market.
Combined with the wealth management business reports released by various wealth management companies, among the above 14 wealth management companies, 7 of the 13 with comparable data have shrunk in scale, among which the balance of ABC wealth management and CCB wealth management products, whose net profit has declined sharply, has declined by double digits, so it has been overtaken by the wealth management of joint-stock banks.
According to the reporter's incomplete statistics, the overall scale of the 13 wealth management subsidiaries (individual for the caliber of assets under management) is currently about 18.09 trillion yuan, a decrease of about 274.5 billion yuan from the end of the previous year. Judging from the issuance in the second half of last year, although the number of newly issued products mostly maintained a year-on-year increase, the scale of most wealth management sub-fundraising decreased compared with the second half of 2022.
According to the reporter's incomplete statistics, CMB Wealth Management, CNCBI Wealth Management, ICBC Wealth Management, Bank of China Wealth Management, CCB Wealth Management, Bank of Communications Wealth Management, Minsheng Wealth Management, and China Post Wealth Management 8 wealth management companies in the second half of last year The total amount of new funds raised decreased by about 4.25 trillion yuan year-on-year, a decrease of nearly 29%. Among them, only CNCBI Wealth Management increased its new fundraising scale in the second half of last year year-on-year.
In terms of the structure of existing products, the proportion of fixed income products in most wealth management sub-products has further increased, while the proportion of equity and hybrid products has decreased. For example, the fixed income category of CMB Wealth Management increased by 1.75 percentage points to 96.76% compared with the end of the previous year, while the equity category and mixed income category decreased from 0.23% and 4.19% to 0.18% and 2.29% respectively. CNCBI Wealth Management, ICBC Wealth Management, Bank of China Wealth Management, CCB Wealth Management, and Bank of Communications Wealth Management also showed a similar trend.
From the perspective of capital use, in the face of capital market fluctuations and the decline in investors' risk appetite, most wealth managers increased the allocation of cash and bank deposits last year, and the proportion of debt assets, including bonds and non-standard assets, was declining.
According to the statistical caliber after asset penetration, among the 8 wealth management companies with comparable data, except for the proportion of BOCOM wealth management's investment in cash and deposits, the proportion of the remaining 7 wealth management companies in cash assets (each with different disclosure standards) has increased to varying degrees. Among them, the proportion of cash and bank deposits directly or indirectly invested by CMB Wealth Management increased by 13.73 percentage points from 15.22% to 28.95%, while the proportion of cash and deposit investments by CNCBI Wealth Management increased significantly from 12.03% to 23%.
In terms of bonds, among the above-mentioned eight wealth management sub-managers, except for Bank of China Wealth Management and Bank of Communications Wealth Management Co., Ltd., most of the remaining wealth management sub-sub-investors have reduced their allocation, but there are differences in the disclosure caliber of each one. For example, the proportion of bonds, non-standard and interbank certificates of deposit of ICBC Wealth Management last year decreased from 62.19% at the end of the previous year to 52.96%, the proportion of CCB wealth management bonds decreased from 45.2% to 30.94%, the allocation of China Post wealth management bonds decreased from 60.74% to 55.23%, the proportion of CMB wealth management bonds and non-standard bonds decreased from 57.05% to 45.05%, and the proportion of CNCBI wealth management debt assets decreased from 76.17% to 67.07%.
This is in line with the trend reflected in the above-mentioned wealth management market report. According to the data, at the end of last year, the allocation ratio of wealth management products to cash and bank deposits increased by 9.2 percentage points compared with the end of 2022, while the allocation ratio of bond assets decreased by 5.1 percentage points in the same period.
In the long run, the allocation ratio of wealth management products to cash and bank deposits has increased year by year, from 9.05% at the end of 2020 to nearly three times. Many institutions believe that the substantial increase in the allocation of deposit assets in wealth management products is mainly related to investors' pursuit of stable and low-volatility assets, and at the same time, the non-standard allocation reduction under the new asset management regulations may be replaced by cash and bank deposits.
(This article is from Yicai)