Since 2024, financial supervision has continued to be high-pressure, and many financial institutions have received fines at the beginning of the year.
According to the data provided by the iFinD Flush platform, the Financial Times reporter found that as of May 13, since the beginning of this year, banking institutions have received a total of 685 fines issued by the People's Bank of China, the State Administration of Financial Supervision and Administration and the State Administration of Foreign Exchange (hereinafter referred to as "one bank and two bureaus"), involving a total amount of 492 million yuan (according to the statistics on the date of the penalty announcement).
From the perspective of the reasons for violations, violations of credit business, imperfect internal management and control systems, and violations of prudential business rules have become the main reasons for the issuance of fines by regulators.
Another bank received tens of millions of "sky-high fines"
From the perspective of the punished objects, since the beginning of this year, different types of banking institutions have been "on the list", including 3 policy banks, 6 large state-owned banks, 12 joint-stock banks, urban and rural commercial banks and foreign-funded banks.
Due to the large number and wide distribution of institutions, rural commercial banks rank first among all types of institutions in terms of the number of fines and the amount of fines. According to the data, as of May 13, a total of 259 fines had been issued to rural commercial banks by one bank and two bureaus, with a fine of about 160 million yuan. The total amount of fines imposed on city commercial banks and large state-owned banks also reached hundreds of millions of yuan, with 120 million yuan and 105 million yuan respectively. In addition, the joint-stock bank was fined a total of nearly 90 million yuan; Policy banks and foreign-funded banks were fined 19 million yuan and 3.0876 million yuan respectively.
Judging from the amount of fines, since the beginning of this year, banking institutions have received a total of 4 large fines of more than 5 million yuan, including 2 urban commercial banks, 1 rural commercial bank and 1 large state-owned bank. The highest single fine is issued by the State Administration of Financial Supervision and Administration.
On January 2 this year, Qilu Bank received the only "sky-high fine" of more than 10 million yuan, with an amount of 14.9513 million yuan. According to the explanation of violations, the State Administration of Financial Supervision and Administration issued as many as 15 penalty reasons for Qilu Bank, including the purchase of non-performing assets of the Bank with credit funds, inadequate management of small and micro enterprises, and inadequate management of personal loans, all of which are extremely important compliance links.
"In recent years, the frequent 'sky-high fines' in the banking industry are the inevitable result of stricter supervision, and do not mean that the compliance operation of the banking industry has regressed. On the contrary, under strict supervision, potential problems and risks are more likely to be exposed, forcing banks to pay more and more attention to compliance operations. Xue Hongyan, vice president of Xingtu Financial Research Institute, said in an interview with a reporter from the Financial Times.
Credit business is still the "hardest hit area"
From the perspective of violations, the fines imposed by banking institutions cover various business areas such as credit loans, account management, bill business, credit cards, wealth management, and foreign exchange settlement and sales.
"From the perspective of revenue structure and profit proportion, credit business is the core business of commercial banks, and the credit business process is long and has many links, and credit resources are scarce resources, which are naturally prone to illegal operations and moral hazard, and have always been the 'hardest hit area' for compliance review in the banking industry." Xue Hongyan said in an interview.
As the core business of commercial banks, credit delivery and management have always been the focus of supervision by financial management departments. The Financial Times reporter combed and found that since the beginning of this year, there are not a few banking institutions that have been punished or even heavily fined for credit business violations, and the number of relevant fines accounts for more than 7% of the total number of fines.
From the perspective of credit violations, the fines involved many aspects, such as failure to perform due diligence in pre-loan investigation, illegal issuance of loans, misappropriation of credit funds, inadequate post-loan management, and failure to perform due diligence in the "three checks" of loans. These problems cover all aspects of the whole process of bank credit business, and also fully expose the loopholes in the current internal compliance management of banks.
At the beginning of this year, the Zhejiang branch of a large state-owned bank was fined 6.45 million yuan for misappropriation of personal loan funds into the stock market in violation of regulations. On March 27, a city commercial bank in Zhejiang was fined up to 3.85 million yuan for "issuing personal business loans to bank employees", "loan management was not in place, personal credit funds were misappropriated to purchase wealth management products and were not corrected in time", "loan management was not in place, and working capital loans were misappropriated for fixed asset investment".
In addition to credit business violations, data security and governance have gradually become the focus of regulatory attention.
For example, in February this year, a leading city commercial bank received a single high fine of more than 3 million yuan, involving a number of data violations, including data omission of the three businesses of Regulatory Standardization (EAST) credit, investment and wealth management, as well as data misstatement of the corporate deposit account and the corporate credit account.
In the view of industry insiders, at present, the regulatory requirements for bank data security and compliance are getting higher and higher, and banks should further strengthen their data governance capabilities, especially the quality and reporting of regulatory data, which are often punished by regulators.
Inflated deposits and loans have "risen"
The reporter found that since the beginning of this year, the number of fines imposed by banks for "inflated deposits and loans" has also increased, and it is widely used in various types of banking institutions. According to incomplete statistics from the Financial Times, in April alone, there were no less than 10 fines related to "inflated deposits and loans", which was a significant increase compared with the same period last year and the previous month.
Another bank received a number of fines for a violation of "inflated deposits and loans". In February this year, Guiyang Bank was fined 350,000 yuan for "inflating deposits and loans". On May 13, Liupanshui Bank of Guizhou was once again fined 1.5 million yuan for three violations of laws and regulations, including "using capital intermediaries to falsely increase the scale of deposit loans" and "non-standard loan management".
The Financial Times reporter learned that at present, the deposit and loan interest rate difference is still the main source of profit for commercial banks. In order to expand revenue, many banks will set up an assessment mechanism of "collecting deposits". As a common means to complete the assessment indicators of deposit and loan scale, the behavior of "inflating deposits" usually occurs at key time nodes such as month-end, quarter-end and year-end evaluations.
Judging from the penalties imposed in the past, banks have used various methods and tricks to inflate deposits. According to the disclosure, the methods used by banks to absorb and falsely increase deposits in violation of regulations mainly include the transfer of deposits by loans, the accumulation of deposits by illegal rebates, the use of third-party fund intermediaries, the absorption of deposits by delayed payment, the absorption of deposits by means of loan bills, the reverse deposit through wealth management products, and the reverse deposit through interbank business.
"The inflated scale of deposits actually increases the cost of loan customers, which is not conducive to the development of the real economy." According to Zhou Maohua, a macro researcher at the financial market department of Everbright Bank, in the medium and long-term development, banks need to shift to high-quality development. Banks should pay more attention to improving the quality of operations, optimizing the asset-liability structure, and increasing the proportion of asset-light business compared with scale expansion.
"At present, financial supervision emphasizes more on optimizing the allocation of financial resources, improving the efficiency of capital use, continuing to crack down on the phenomenon of capital idling, and the accounting caliber of financial added value has also been optimized." In an interview with the Financial Times, Xue Hongyan said that with the changes in the internal and external environment of inflated deposits and loans, the relevant violations are also expected to continue to decline.
Source: Financial Times client
Reporter: Zhang Bingjie
Editor: Yang Jingyi
Email: [email protected]