Sino-Singapore Jingwei Client, August 4 (Wei Wei) The "boots" that extended the transition period of the new asset management regulations finally landed. On July 31, the official website of the central bank showed that the "Guiding Opinions on Regulating the Asset Management Business of Financial Institutions" (commonly known in the industry as the "new asset management regulations") transition period was extended to the end of 2021, one year longer than the original plan.
The relevant person in charge of the central bank said that an appropriate extension of the transition period can alleviate the impact of the epidemic on asset management businesses, help alleviate the pressure on financial institutions to rectify and reform, and provide a relaxed environment for financial institutions to cultivate standardized asset management products. Institutions involved in the new asset management regulations include products from financial institutions such as banks, trusts, securities, funds, and futures, among which bank wealth management products are most concerned. For ordinary investors, what impact will the new asset management regulations have on buying wealth management?
Guaranteed financial products are hard to find
Will the new asset management regulations have an impact on buying wealth management? The answer is yes. The most obvious is that capital-guaranteed financial products are gradually disappearing from the market.
In the "Guiding Opinions on Regulating the Asset Management Business of Financial Institutions" issued in 2018, Articles 2 and 6 clarify the requirements for "breaking rigid redemption":
Article 2 stipulates that the asset management business is off-balance sheet business of financial institutions, and financial institutions shall not promise to guarantee principal and return when carrying out asset management business. When payment difficulties arise, financial institutions shall not advance funds in any form.
Article 6: Financial institutions should strengthen investor education, continuously improve investors' financial knowledge and risk awareness, and convey to investors the concept of "sellers are responsible and buyers are responsible" to break rigid payment.
The Sino-Singapore Jingwei client inquired on the official websites of many banks and found that most of the wealth management products on sale have been converted to net-value wealth management products, but there are still a few principal-guaranteed wealth management products on sale.
Wind statistics show that there were 5218 wealth management products on sale on August 4, of which only 566 were guaranteed fixed and floating wealth management products, accounting for only 10.85%.
In terms of types of institutions, among the principal-guaranteed wealth management products on sale, city commercial banks and rural commercial banks have the largest number, with a total of 349, accounting for 61.67%. There are a total of 102 joint-stock banks, accounting for 18.02%. There are only 30 of the six state-owned banks, accounting for only 5.3%. There are 85 other banks, accounting for 15.02%.
"We would still recommend buying principal-guaranteed wealth management products because of task-oriented reasons. Now principal-guaranteed wealth management products are still deposits; net-worth wealth management is only considered as financial assets and has no appraisal. But principal-guaranteed products are not easy to sell because of the benefits. The rate is a range, with a minimum guarantee and an upper limit. It is uncertain which benefit will be realized in the end." A customer manager of a state-owned bank told the Sino-Singapore Jingwei client that because the customer's acceptance of net-value wealth management products is not high, non-guaranteed floating returns The expected high yield of wealth management products has become a hot commodity, and the quota is shrinking sharply, and it is basically sold out every day.
Yin Yanmin, editor-in-chief of Rong360 Big Data Research Institute, told the Sino-Singapore Jingwei client that the new asset management regulations require banks to gradually break the rigid exchange of wealth management products, and investors should bear their own risks. For investors who are accustomed to bank guarantees, they need to change their thinking. In the past, there will be fewer and fewer capital-guaranteed wealth management products with expected return rates, and net-value wealth management products with non-guaranteed floating returns will become mainstream products in the market.
Are structured deposits principal protected?
Since the release of the "New Asset Management Regulations", capital-guaranteed wealth management products have gradually faded out of the market, and banks are facing the risk of losing customers. Therefore, structured deposits have become a new weapon for banks to attract savings. Regarding whether structured deposits are deposits or financial management, many investors are also "seeing the flowers in the fog."
"Structured deposits are a special deposit product that is a collection of deposits and wealth management. Its investment is divided into two parts: one is used to invest in deposits, and this part is subject to the corresponding deposit reserve, which is subject to deposit insurance. System protection; the other part is invested in financial derivatives, such as futures, options, gold, crude oil, etc. This part is not protected by the deposit insurance system." Huang Dazhi, a senior researcher at the Suning Institute of Finance, explained to the Sino-Singapore Jingwei Client.
Huang Dazhi said that because of the high-risk nature of the investment in financial derivatives, structured deposit products are managed in accordance with financial sales regulations, such as "double recording".
Structured financial management is called a floating-income deposit product. Source: Photo by Wei Wei, Sino-Singapore Jingwei
During the visit of the Sino-Singapore Jingwei client, it was found that many banks were still confused in the sales caliber and page display of structured deposits. Some bank account managers introduced structured deposits as principal-guaranteed wealth management products. On the official website of ICBC, structured deposits are classified into "capital guaranteed floating" products in wealth management.
Source of structured deposits displayed in wealth management products: ICBC official website
In July 2020, the Bank of Communications app issued a notice to migrate structured deposit products from the original "financial management-guaranteed" type to "wealth-deposit". When introducing structured deposits on the leaflet of Bank of Jinzhou, it is stated that the product is a "guaranteed floating income deposit product".
Although the classification has not yet been unified, the marketing caliber of each bank for structured deposits is unified as "capital preservation". "Domestic structured deposit products are designed to be capital-guaranteed through the control of the investment ratio of deposits and financial derivatives, and will not allow customers to bear such high risks. Structured deposits will have a range of returns, with a lower limit and an upper limit. ." Huang Dazhi said.
He believes that after the end of the transition period of the new asset management regulations, there will no longer be the concept of capital-guaranteed financial management, and the "capital preservation" of special products such as structured deposits should not be promoted.
Huang Dazhi pointed out that for individual investors, it is necessary to break the notion that "structured deposits" are capital-guaranteed and just redeemed. Real structured deposit products have certain investment risks, their returns are uncertain, and the degree of risk is relatively high. Investors need to have certain knowledge of derivatives transactions, such as interest rates, exchange rates, futures, options, etc., in order to be better Conduct financial management.
Products with an annualized rate of return of more than 4% are gradually decreasing
For wealth management customers, the most concerned question is whether the extension of the transition period of the “new asset management regulations” will affect the yield of bank wealth management products?
The Sino-Singapore Jingwei client found that the current benchmark for the performance of capital-guaranteed wealth management products of state-owned banks is relatively low, around 2%. For example, the initial purchase amount of ICBC's principal-guaranteed personal 91-day Wenli RMB wealth management product is 10,000 yuan, the performance benchmark is 2.2%-2.3%, and the shortest investment period is 91 days. Agricultural Bank of China’s principal-guaranteed wealth management products have a period of 34 to 90 days, with an expected return rate of 2.1%-2.3%. CCB’s principal-guaranteed wealth management product "Qianyuan-Zhongxiang Capital-guaranteed RMB Wealth Management Product No. 46 in 2020" has a purchase amount of 10,000 yuan, an investment period of 92 days, and a performance comparison benchmark of 2.6%.
The benchmark for the performance of principal-guaranteed wealth management products of city commercial banks and rural commercial banks is relatively higher than that of state-owned banks and joint-stock banks. For example, Jinzhou Bank’s "Tiantianshang 205 Section D" open-end principal-guaranteed products have an investment period of 35 days and are available for sale. The amount is 50,000 yuan, and the performance benchmark is 3.7%; the investment period of "Bohai Tongbao's Anying Series 2020 66th Financial Products" sold by Yingkou Bank in Liaoning and Heilongjiang provinces is 91 days, and the performance benchmark is 4.05%.
Yin Yanmin believes that from the perspective of macro policy, monetary policy will be further loosened in the second half of the year, funds will be abundant, and income from fixed-income assets will fall further. There is still room for the downward trend in the income of bank wealth management products whose investment targets are bonds.
She suggested that for conservative investors, given that capital-guaranteed wealth management products will continue to shrink in the later period, investors can choose mid- to long-term capital-guaranteed wealth management products to lock in products and current returns. For investors with risk tolerance, they can appropriately allocate equity investment products, or hybrid bank wealth management products with higher risks, to obtain relatively higher returns.
Dong Ximiao, the chief researcher of China Merchants Finance, told the Sino-Singapore Jingwei client that investment and financial management must consider the issue of asset allocation. Now the entire market is in a reasonable and sufficient state of liquidity, and the yield of financial products has declined compared with last year. The implementation of the "Rules for the Determination of Bond Assets" will have some impact on wealth management products. When choosing wealth management products, more attention must be paid to the balance between risks and returns. In the future, buying wealth management products will have higher requirements for investors, and you can no longer buy wealth management with your eyes closed. (Zhongxin Jingwei APP)
(The opinions in the 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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