Banking is now negatively profitable: customers’ mentality changes, some require capital preservation, and others require high returns

　　China-Singapore Jingwei Client, June 16 (Wei Wei) On June 3, 2019, CCB Wealth Management, the first wealth management subsidiary in the history of Chinese finance, opened. Now, a year has passed, including the latest share net worth of dozens of wealth management products, including China Merchants Bank’s “Agency Sales Season 1” fixed income wealth management products, and Ping An wealth management’s 180-day (net worth) RMB wealth management products The occurrence of a situation below 1 has broken the belief in "rigid payment" of wealth management products.

　　Many investors angryly pointed at the account managers who recommended financial products to them and complained on third-party complaint platforms. In front of the bank account manager, there is a dilemma. On the one hand, the investor’s thinking has not changed, and on the other hand, it is the pressure of the bank’s performance evaluation. Should it continue to push net worth wealth management products to customers, or switch to other products?

Breaking just came really

　　"The biggest headache is how to explain the wealth management products to the uncle." When asked about the difficulties in selling the net wealth management products, Liu Yongchang said while shaking his head. "You don't tell her clearly, the products will fluctuate in the future. The aunt can’t afford it. So, I can only tell the aunt that now the state stipulates that wealth management products will not allow capital preservation, and future capital preservation wealth management products will be gone. If you are worried that the principal and income are not guaranteed, buy a deposit."

　　According to Liu Yongchang, after graduating from graduate school, he joined a Beijing branch of a joint-stock bank and worked as a financial account manager for more than 4 years. Since last year, he has been exposed to net worth wealth management products.

　　2019 can be described as the first year of the wealth management subsidiaries of banks, and the wealth management subsidiaries of major banks have opened one after another. According to data from the China Banking Regulatory Commission, as of the end of April 2020, 19 banks had been approved to establish wealth management subsidiaries, 12 wealth management subsidiaries had started operations, and the total balance of non-guaranteed wealth management products of banks and bank wealth management subsidiaries was 25.9 trillion yuan. Net worth wealth management products The issuance is constantly increasing.

　　Liu Yongchang was also concerned about the recent "net worth break 1" situation of net worth wealth management products. Although the bank he worked for has not seen a similar situation for the time being, this incident also gave him a "precautionary injection" in advance.

　　China Merchants Bank's wealth management agency opened the No. 1 product quarterly and its annualized return rate was -4.42% in the past month. Source: China Merchants Bank APP

　　He admits that the net worth products are not as fixed as the original financial products. The rate of return is even fixed, so there will be more pressure on customers to explain and comfort.

　　Not long ago, his bank had a "black swan" incident. According to Liu Yongchang, the bank issued a structured deposit product that linked the exchange rate of the US dollar to the Canadian dollar. Because crude oil plunged during the epidemic, the Canadian dollar is known as the "oil currency" and is closely linked to oil prices. After the crude oil plunge, the Canadian dollar plunged and broke its peg range. "This area has never had an accident in the past 20 years, but that black swan event is equivalent to 20 years. This structured deposit has a guaranteed annualized return of 0.3% and a maximum annualized return of 4%. As a result, it stepped on the mine and failed to achieve an annualized return of 4%, which directly fell to 0.3%."

　　Liu Yongchang told the reporter of China New Singapore Jingwei that after the incident, many customers expressed dissatisfaction with the incident, including the bank’s own employees who also bought this product. After the “Black Swan” incident, they could only continue to explain to customers, Appease their emotions.

　　Unlike Liu Yongchang, Chen Yuxiang, who is a wealth management account manager at a state-owned bank, really felt the impact of the return of net worth wealth management products falling to a negative value.

　　In her bank's customer base, some customers were "surprised" by the recent negative value, and asked why this happened. "We can only appease customers and say that the bond market is not good now, and the market is temporarily adjusted, and then it will slowly be adjusted back."

　　When asked whether he would explain to the customer whether the product is guaranteed or not, Chen Yuxiang bluntly said that when introducing the product, he will emphasize the nature of the product, and there is basically no excessive publicity in order to complete the task. "Our bank's net worth wealth management products have a very light task, and the focus is on deposits, so we will not actively recommend net worth wealth management products to customers. We mainly sell structured deposits, large deposit certificates and fixed deposits. If the customer really wants to When you buy a wealth management product, you will introduce the risk at your own risk, but now it has just been broken and it is different from the original wealth management product."

Customer mentality diverges

　　In Chen Yuxiang's view, net worth wealth management products have higher requirements on customers' risk tolerance. "Some of the more aggressive customers have more investment experience. In addition, he feels that there are no products to invest in the market, and he will still buy net worth wealth management products." But he admitted that most of them come to the bank to do wealth management Customers, prefer to have a slightly lower interest rate, but also hope that the principal and income are "mainly stable", so according to his observation, the state-owned big banks are not very strong in promoting net worth wealth management products.

　　　Source of RMB data map: Photo by Xiong Jiali, Sino-Singapore Jingwei

　　In addition, since the net-value wealth management products do not bring much intermediate business income (hereinafter referred to as "mid income") to account managers, bank account managers are not enthusiastic about promoting it.

　　"For us, the most important assessment pressure is insurance. Insurance can increase intermediate business income. For banks, it is a relatively high profit. Now the deposit interest rate is relatively low. Although the fund also has intermediate income, the yield is unstable, and customers lose money. It’s easy to hurt customers, and insurance will be relatively stable.”

　　Liu Yongchang in joint-stock banks also felt the same way. The joint-stock bank assessment where he works is divided into three parts: financial assets, deposits and intermediate business income. In the middle income, in addition to bank self-management, etc., there is also wealth middle income, mainly consignment products, including funds, insurance, precious metals, etc. "These have corresponding indicators every year, requiring financial assets, deposits and The middle income will increase by a certain amount compared with the previous year."

　　Liu Yongchang observed that at present, the proportion of net worth wealth management products in all wealth management products has increased, while the yield of bank deposits has been declining, and customers have gradually diverged.

　　"Some of the more conservative investors require that they must preserve capital. They will switch to bank deposits, but this is only a small number of people." Liu Yongchang said that most of the customers he contacts are still willing to take certain risks to obtain Higher yield.

　　"There are fewer and fewer fixed-income products, and customers have no choice but to force these customers to accept net worth wealth management products. After net worth wealth management products have negative returns, some customers will be more willing to accept risks. High fund products, for the account manager, the middle income will be higher." Liu Yongchang said.

Some banks push "transition" of counterfeit net worth products

　　The return on net worth wealth management products is negative. At first glance, it is scary, but insiders have different voices.

　　"At least it shows that their products are real net worth wealth management products." Wang Linlin told Sino-Singapore Jingwei client that she previously worked as an account manager in a city commercial bank. According to her observation, the so-called net worth wealth management products issued by this city commercial bank are solid The product is packaged and not a true net worth product.

　　"For example, a certain net worth wealth management product gives a performance comparison benchmark of 4.8%, and the actual annualized return on maturity is 4.85%. This is true for each period, and all net worth wealth management products can reach the maturity return rate. Performance comparison benchmark, and the return rate will not exceed the range of 0.1%, how can the net worth return be so accurate?" Wang Linlin expressed doubts about the authenticity of the bank's net worth wealth management products.

　　Chen Yuxiang also observed that the net worth curve of a bank's net worth wealth management product started as a horizontal straight line, and then suddenly rose to a diagonal line. "This may be fake, but only in the form, in fact, it is still the original wealth management product." He analyzed that some banks may worry that customers are difficult to accept net worth wealth management products, so they use "false net worth" products to transition a bit.

　　An industry insider told the Sino-Singapore Jingwei client that a batch of fake net worth wealth management products appeared in July and August 2019, because some investors still need some time to accept net worth wealth management, and many banks Using the transition period of the new asset management rules, first set up a fake net worth wealth management product, and gradually instill the concept of "net worth wealth management product" to users, but in fact, it will still follow the methods of capital pool, maturity mismatch, and expected rate of return. Operation, after the product expires, it will be redeemed at the expected rate of return.

　　However, the recent annualized returns of net worth wealth management products have shown a negative value, which also shows that these products are true net worth rather than "pseudo net worth."

　　Liu Yongchang said frankly, from the perspective of the staff, he thinks his responsibility is greater.

　　"Now the product structure is more complicated, and the regulatory requirements have been broken, so the existence value of the bank wealth management account manager is even greater. Many clients do not understand these professional knowledge, and the account manager needs a targeted explanation based on the risk tolerance of the client. Recommend." Liu Yongchang said. (Sino-Singapore Jingwei APP)

　　(At the request of the interviewees, Liu Yongchang, Chen Yuxiang and Wang Linlin are all pseudonyms)

　　(The opinions in this article are for reference only, and do not constitute investment advice. Investment is risky and you need to be cautious when entering the market.)

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