China Business Daily (reporter Wang Tongxu) On May 11, the People's Bank of China released financial statistics for April. According to the data, the cumulative increase in the scale of social financing in the first four months of 2024 was 12.73 trillion yuan, 3.04 trillion yuan less than the same period of the previous year. According to the estimation of a reporter from China Business Daily, the cumulative increase in the scale of social financing in the first quarter was 12.93 trillion yuan, and the increase in the scale of social financing in April was negative.
In terms of RMB loans, RMB loans increased by 10.19 trillion yuan in the first four months, of which 730 billion yuan were added in April.
Yang Chang, chief analyst of the policy team of Zhongtai Securities Research Institute and chief expert of the Institute of Public Policy and Governance of Shanghai University of Finance and Economics, told China Business Daily that the increment of social financing fluctuated in April, mainly due to the disturbance of the rhythm of government bond issuance. With the gradual progress of subsequent bond issuance, it is expected to promote the restoration of social finance.
The photo shows citizens passing by the People's Bank of China in Beijing. (PHOTO COURTESY OF CNSPHOTO)
Credit increased slightly
In April this year, new RMB loans increased by 730 billion yuan from the previous month, an increase of 11.2 billion yuan year-on-year. In terms of sub-sectors, household loans decreased by 516.6 billion yuan, a year-on-year decrease of 275.5 billion yuan; Loans to enterprises and institutions increased by 860 billion yuan, an increase of 176.1 billion yuan year-on-year.
"The data shows that the financing demand of residents still tends to contract, while the medium and long-term financing demand of enterprises is more resilient." Jiang Fei, a macroeconomist at Great Wall Securities, said.
In terms of household deposits, short-term loans and medium- and long-term loans to households increased by 351.8 billion yuan and 166.6 billion yuan respectively in April. Overall, short-term loans were lower than the same period last year, and medium- and long-term loans also increased less than year-on-year.
"Short-term loans increased slightly year-on-year, pointing to fluctuations in consumer demand; Medium and long-term loans increased slightly year-on-year, pointing to the low fluctuation of residents' willingness to buy houses. Yang Chang said.
Huajin Securities said that the net decrease of resident loans in April was 516.6 billion yuan, indicating that the current expectations of mainland residents for the real estate market have not been reversed. At present, the main medium- and long-term factor driving the real estate market, the demographic structure, has entered the stage of the stock game between first-tier cities and second-tier cities, and it is expected that for a long time to come, it is difficult to see a significant improvement in loans to the residential sector, which is mainly driven by the real estate market.
However, there are also differing views. Jiang Fei believes that since the end of April, the property market has ushered in a rare wave of relaxation, Chengdu, Hangzhou and Xi'an have successively fully relaxed purchase restrictions, and it is expected that the relaxation of real estate policies is the general trend. In the future, there may be room for improvement in medium and long-term loans for residents, which will drive more loans to residents.
In addition, the "Relationship between Credit Growth and High-quality Economic Development" column under the central bank's "Monetary Policy Implementation Report for the First Quarter of 2024" (hereinafter referred to as the report) said that the relationship between credit growth and economic growth in the mainland tends to weaken. At present, the mainland's total credit has slowed down from a high growth rate of more than double digits in the past to single digits, but this does not mean that financial support for the real economy has weakened. At the macro level, more attention should be paid to grasping the tightness and appropriateness of the financing environment.
Deposits have increased sharply
According to the data, RMB deposits increased by 11.24 trillion yuan in the first quarter, while RMB deposits increased by 7.32 trillion yuan in the first four months of this year. In April, RMB deposits fell sharply by nearly 4 trillion yuan (3.92 trillion yuan). Among them, household deposits decreased by 1.85 trillion yuan, a year-on-year decrease of 650 billion yuan, and enterprise deposits decreased by 1.87 trillion yuan, a year-on-year decrease of 1.73 trillion yuan.
This is in stark contrast to the fact that residents are keen on deposits and the increase in bank deposits has remained high in the past two years: according to central bank data, the increase in RMB deposits in 2022 and 2023 will be 26.26 trillion yuan (of which household deposits will increase by 17.84 trillion yuan) and 25.74 trillion yuan (of which household deposits will increase by 16.67 trillion yuan).
In this regard, Dong Ximiao, chief researcher of Zhaolian, believes that with the recent recovery of the wealth management market and the rise in investment yields, residents' enthusiasm for purchasing wealth management products has rebounded, and residents' deposits have accelerated their transformation into wealth management products.
According to the research and estimation of CITIC Securities, the scale of bank wealth management decreased by about 1.2 trillion yuan month-on-month in March this year, and the overall scale of wealth management expanded to 28.97 trillion yuan as of April 19, an increase of 2.17 trillion yuan from the end of 2023.
Experts said that the rebound in residents' enthusiasm for buying wealth management products is behind the active reduction of banks' high-interest liabilities.
Recently, a number of banks have officially announced the removal of 3-year and 5-year large-value certificate of deposit products. The reporter's previous investigation found that although some banks have not removed the 3-year large-amount certificate of deposit product from the shelves, the current product is "insufficient".
"The interest rate on bank deposits has fallen again and again, and it is difficult to grab large-amount certificates of deposit, so it is definitely necessary to consider other ways to protect the capital and manage the money." During the visit, some investors told reporters.
The central bank pointed out in the report that there will be relative changes in the rate of return of various assets such as on-balance sheet deposits and off-balance sheet managed products, which will affect residents' risk appetite and investment behavior, and residents will adjust their asset allocation accordingly, which is also an important factor affecting the proportion of residents' deposits.
The money supply is declining
According to the data, at the end of April this year, the broad money supply (M2) increased by 7.2% year-on-year, 1.1 percentage points lower than the end of the previous month, and the narrow money supply (M1) decreased by 1.4% year-on-year, and the growth rate was 2.5 percentage points lower than that at the end of the previous month.
According to the report, the current currency of the mainland is divided into three levels: M0, M1, and M2. M0 is what we often call "cash", which is the most active and has the highest liquidity; M1 is M0 plus a unit demand deposit with slightly less liquidity; M2 is M1 plus less liquid unit time deposits, resident deposits, etc.
Ming Ming, chief economist of CITIC Securities, said that the growth rate of money supply has declined significantly, mainly because since April this year, under the background of seasonal factors and manual interest rate supplements, many deposit funds have been transferred to bank wealth management and other asset management products, which cannot be interpreted unilaterally as a decline in the ability of finance to support the real economy; On the contrary, the supervision of deposits will help revitalize funds and help finance better support the recovery and development of the real economy.
Although the growth rate of M1 and M2 continues to decline, the report points out that the current money stock is already quite large. The People's Bank of China (PBoC) has made great efforts to regulate the "general gate of money supply", but it has also had a great impact on the structural problems of deposits and loans such as "where the money goes, where does the money go".
"At the same time, the report proposes to 'increase efforts to revitalize the stock of financial resources, pay close attention to the situation of capital precipitation and idling, promote the improvement of the efficiency of capital use, and provide better support for high-quality economic development'. From this perspective, the growth of monetary aggregates and new loans may no longer be a priority indicator for the central bank in the next stage, and structure and efficiency may become more important. Jiang Fei said.