Securities Times reporter Sun Lulu
The People's Bank of China "Second Arrow" has new news.
On November 8, the Interbank Market Dealers Association (hereinafter referred to as the Dealers Association) announced that in order to support the healthy development of private enterprises, under the support and guidance of the People's Bank of China, the Dealers Association will continue to promote and expand the support for private enterprise bond financing. Tools to support private enterprises, including real estate companies, to issue debt financing.
This second arrow originated from the "combination punch" created by the central bank in 2018 to support private enterprises in expanding financing channels.
In order to resolve the financing difficulties faced by private enterprises and small and micro enterprises, the central bank, together with relevant departments, studied the three main financing channels of bonds, credit and equity, and adopted a policy combination of "three arrows" to support private enterprises in expanding financing channels. Solve the problem of "water shortage" in private enterprises.
Specifically, the first arrow is credit support, the second arrow is a bond financing support tool for private enterprises, and the third arrow is a private enterprise equity financing support tool.
Four years have passed since 2018, and positive results have been achieved in improving the financing environment of private enterprises, especially the inclusive small and micro loans that solve the financing difficulties and expensive financing of small and micro enterprises have achieved great development.
The extension and expansion of the second arrow this time is regarded as a powerful measure to improve the financing environment of private housing enterprises. Some analysts believe that the central bank and other departments have no doubts about the policy attitude towards financing support for private enterprises. With the expansion of the scale and scale, the role of support tools will be further brought into full play, which will help boost investor confidence, and especially help stabilize and expand the financing scale of private enterprises.
Inclusive small and micro loans expanded by more than 3 times in four years
For the first arrow, in recent years, the People's Bank of China has provided long-term, cost-effective funds for financial institutions to support private enterprises through targeted RRR cuts and medium-term lending facilities (MLF).
Since 2018, the re-lending quota for small and medium-sized enterprises has been increased by 1.49 trillion yuan, the re-lending rate has been lowered by 0.75 percentage points, and financial institutions have been encouraged to increase credit to private enterprises.
From 2018 to 2019, the Targeted Medium-Term Lending Facility (TMLF) will be used in stages to support large commercial banks and joint-stock commercial banks to provide long-term stable funds to private enterprises. The amount of operations is linked to the strength of their support for private enterprises, and the interest rate is more favorable than the medium-term lending facility.
In the macro-prudential assessment (MPA), relevant assessment indicators such as financing of small and micro enterprises and private enterprises are gradually increased, and financial institutions are guided to support small and micro enterprises and private enterprises.
Two direct tools, including the Inclusive Small and Micro Enterprise Loan Deferred Principal and Interest Repayment Support Tool and the Inclusive Small and Micro Enterprise Credit Loan Support Plan introduced in 2020, as well as the Inclusive Small and Micro Loan Support Tool established after the conversion in 2022, are also available. It mainly supports small and micro enterprises, mainly private enterprises.
In general, a series of policies of the first arrow have achieved positive results.
In particular, inclusive small and micro loans, which solve the financing difficulties and high financing costs of small and micro enterprises, have been greatly developed. At present, the balance of inclusive small and micro loans has exceeded 23 trillion yuan, and the capacity has been expanded by more than three times in four years.
Zhang Xu, chief fixed income analyst at Everbright Securities, told the Securities Times reporter that the central bank has comprehensively used monetary and credit policy tools to guide financial institutions to increase credit to private enterprises, and achieved good results.
In terms of the number of loans, among the newly issued corporate loans in the first half of this year, the proportion of private enterprise loans has reached 53.5%, which has increased significantly compared with previous years, and even approached the proportion of the private economy in GDP.
From the perspective of loan interest rates, the annualized interest rate of newly issued private enterprise loans continued to maintain a downward trend, with a year-on-year decrease of 0.64 percentage points in the first three quarters of this year.
lead rational view
Private enterprise credit risk
The second arrow is funded by the central bank's re-lending, and entrusts professional institutions to support private enterprises to issue debt financing through guarantees to increase credit, create credit risk mitigation certificates (CRMW), and directly purchase bonds in accordance with the principles of marketization and rule of law. .
Since the NAFMII promoted the creation of CRMW to support private enterprise bond financing in the fourth quarter of 2018, as of the end of October 2022, a total of 42 billion yuan in nominal principal of CRMW linked to private enterprise bonds has been created, supporting a total of 113.2 billion yuan in private enterprise bond issuance.
On November 8, the news of the extension and expansion of the second arrow came out, which aroused the market's renewed attention.
According to reports, the NAFMII will continue to advance and expand the second arrow to support private enterprises, including real estate enterprises, to issue bonds for financing.
The NAFMII stated that in the future, with the expansion of the scope and scale of support for private enterprises to issue bonds and financing, the role of support tools will be further brought into full play, which will help boost investor confidence, especially to stabilize and expand the financing of private enterprises.
Zhang Xu said that since the beginning of this year, the stratification of the credit bond market has become more obvious. Investors have strong demand for state-owned enterprise credit bonds, and the yield once fell rapidly, but their willingness to invest in private enterprise bonds is relatively low.
"At this stage, the market's judgment on the credit risk of private enterprises has some excessive and irrational elements, which may 'wrongly kill' some well-qualified entities across the board. At this time, the extension and expansion of the second arrow can guide the market rationality. View credit risks in a more respectful way, and support private enterprises including real estate companies to issue bonds for financing.” Zhang Xu said.
The second arrow expansion is mainly to support private housing enterprises to issue debt financing.
At present, ChinaBond Enhancement Co., Ltd. has included the "Second Arrow" for the overall development of the credit enhancement work for private real estate enterprises to issue bonds, and provide credit enhancement support for the issuance of bonds by real estate enterprises that are generally financially healthy and face short-term difficulties.
Li Kai, the founding partner and chief investment officer of Shenzhen High Investment, told the Securities Times reporter that the second arrow will be expanded to support private housing companies in issuing bonds, which will benefit issuers and investors.
From the issuer's point of view, this tool can support well-run private real estate enterprises with financing needs to issue bonds and raise funds at a faster speed and with better conditions.
For investors, this time, it is clearly stated that "about 250 billion yuan of private enterprise bond financing can be supported, and the capacity can be further expanded in the follow-up depending on the situation", and clarifying the specific policy scale to the market can greatly boost market confidence. It can be seen from the surge in stocks and bonds in the sector that the market highly recognizes this policy.
According to the research report of GF Securities, the scale of 250 billion yuan is enough to cover the maturity scale of private real estate enterprise bonds that have not defaulted in the next year (140.2 billion yuan).
The policy will not ignore the importance of the real estate industry to the safety of the financial system and the safety of residents' assets, and it is necessary to have confidence in the policy to solve the problem.
Zhang Xu also said that the tool organically combines the two attributes of policy and market.
On the one hand, it has policy attributes and aims to boost the market's confidence in private enterprises, while maintaining reasonable and appropriate financing of real estate.
The credit enhancement service rate of ChinaBond Enhancement Corporation for private housing enterprises is lower than 0.8%/year, which is only about half of the market-oriented private enterprise credit enhancement service rate of 1.5%, which is far lower than the market-oriented rate of private real estate enterprises. It has significantly saved comprehensive financing costs for bond-issuing companies, reflecting the role of policy support.
On the other hand, the tool adheres to the principles of marketization and the rule of law, does not engage in hard assignment of tasks, and does not directly interfere with the decision-making of micro-subjects, which is a manifestation of its market attributes.
It is reported that after the expansion of the second arrow, the NAFMII has now accepted the Longfor Group's 20 billion yuan rack-based registration and issuance, and ChinaBond Enhancement Co., Ltd. has simultaneously accepted corporate credit enhancement business intentions.
In addition, a number of private real estate companies are also communicating their intention to register for bond issuance, and the Dealers Association and China Bond Development Corporation are actively promoting the acceptance review.
real estate credit
Possibility to usher in a new beginning
It is a worldwide and long-term problem that private enterprises, especially small and medium-sized enterprises, have difficulty and expensive financing.
Yi Gang, governor of the central bank, once said that my country's financial services are not "inclusive" enough for private enterprises, especially small, medium and micro enterprises, and there are system and mechanism flaws, and long-term efforts are needed to make up for "market failures."
Financial workers should have a clear understanding of the shortcomings of serving the private economy, and must design and implement incentive-compatible mechanisms to effectively improve the coverage, availability, and convenience of financial services in the private economy, and promote reforms to “make up for the shortcomings.” ".
Since the beginning of this year, the pressure of stable economic growth has further increased, and the problem of improving the financing environment of private enterprises has once again become prominent.
Some analysts believe that the recent "overweight" policy support by relevant departments highlights the policy determination to stabilize credit, and it is expected that more support policies will be implemented in the future.
The chief economist of CITIC Securities clearly stated that for the credit expansion of the whole society, the policy strength and policy determination should not be underestimated. Regarding the current economic and financial situation, what measures the relevant departments will take will become the focus of the follow-up market game.
"To get rid of the vicious circle of weak sales, difficult credit financing and high delivery uncertainty, the real estate industry really needs further support policies." Mingming said that the industry is currently experiencing a weak recovery, the default situation has improved, and the credit environment has continued to improve. possibility.
If the follow-up policies can effectively drive real estate sales, it is expected that the net financing and interest spread of real estate bonds may improve in the future, and real estate credit will also usher in a new starting point.