Financial Subsidiaries, Public Fund Runway More Standardized Head Institutions, The Size Of The Commission Is Not Falling Or Rising

The financing subsidiary of commercial banks is racing fast and landing quickly.

In December 19th, xingyin bank's wholly owned financial management company, Xingyin Financial Management Co., Ltd. opened in Fuzhou and became the third financial holding subsidiary of joint-stock banks.

On the same day, the Bank of Nanjing announced that the Banking Regulatory Commission approved the Bank of Nanjing to prepare South Bank Financial Management Co., Ltd. Prior to this, Ningbo bank, Hangzhou bank, Huizhou Merchants Bank three city commercial bank's financial subsidiaries have been approved to prepare for the construction.

Cash management VS Monetary Fund

With the successive landing of bank financing subsidiaries, the competition between financial subsidiaries and public offering funds will become more intense.

In December 19th, a survey by Tencent financial management and fund rating agency Morningstar on 54 public funds showed that 54% of fund managers predicted that the fastest growth of financial products in 2020 was public offering funds, while 38% of fund managers predicted faster growth of bank financing.

Judging from the classification of products, bank financial products are mainly short-term non net worth financing, and fund companies are mainly net value floating income products. On the one hand, bank financing relies on the parent line and dividend policy, and has won the natural competitive advantage. On the other hand, the ability of the public fund to invest in the industry for many years is not worth the short-term financial management.

The first thing to compare is cash management products. At present, the main starting point of Bank net transformation is cash management products. The risk of cash management products is lower than that of the standard money fund, and the amount of T+0 foreclosure is higher.

A head of Southern China banking information management department said that in the transitional period of bank financing, the strategy of commercial banks is to issue cash management products, usually T+0 or T+1 because of the gradual expiration of non-standard business. Some banks choose to open in 7 days. One is to undertake the old customers who have financial services. The two is to compete with the monetary fund of public funds. At present, cash management products have become the highest financial products category in some banks.

Because the regulatory standards of cash management products have not yet been unified, different banks have different definitions and norms.

The key to the competition between the two is the corporate income tax of 25%. The dividend income from the public fund can be exempted from 25% of the enterprise income tax, and the cash management products of other information management organizations need to pay 25% of the corporate income tax.

"4% earnings management, only 3.8% of income tax revenue is removed, and the cost of distribution channels should be removed." A bank management source said that next year, the bank's cash management products yield will continue downward.

In the case of stable monetary policy tone, the market interest rate level is expected to remain stable, and the liquidity of the capital side will continue. Next year, the yield of Monetary Fund will continue to bear down. Tencent financial management and morning star fund managers questionnaire shows that 59% of fund managers predict that the yield of Monetary Fund will further decline in 2020.

Recently, some trust companies began issuing cash management fund trust products. Since the second half of last year, many trust companies have started building fixed income units to recruit troops in the bond market.

According to the fund industry association data, as at the end of 9, the net asset value of the IMF was 7 trillion and 30 billion, which was about 7 percentage points lower than the 7 trillion and 590 billion yuan at the end of 2018.

"Solid income +" PK equity products

The advantages of bank financing are non-standard and bonds. In the process of transformation, many banks have chosen "fixed income +" as the direction.

For example, xingyin financial management has just been set up in Xingye Bank's financial products center. After its establishment, it will assume the core functions of issuing and investment management of financial products, with the main force of "fixed income +" and equity products.

On the one hand, the "fixed income +" products fit the risk preference of the main financial customers of bank management, which are the product types which are good at the bank's information management institutions. On the other hand, the rights and interests products can give full play to the advantages of differentiation and enhance the market competitiveness.

At present, the scale of financial services of Xingye Bank is more than 1 trillion and 300 billion, ranking second in the domestic shareholding banks, accounting for over 40% of the new products in line with the new regulation of information management. On the day of its opening, Xingyin Financial Bureau issued the "eight core and three characteristics" product framework system, and put forward the development thinking of constructing the information management ecosystem.

Specifically, the "eight core" covers cash management, pure debt investment, fixed income enhancement, project investment, equity debt mix, equity investment, multi asset strategy, cross-border investment, and other mainstream product lines. "Three major features" include: launching the Straits index products; integrating ESG evaluation system into investment practice; continuing to create green financial products; and innovating pension financial products for customers.

For public offering funds, the key to growth next year is to look ahead to the equity market next year.

In 2019, equity assets in the global category of assets outshine others. 88% of the surveyed fund managers believe that there will be better investment opportunities in 2020. Compared with the US stock market and European stock market, fund managers prefer A shares and Hong Kong stocks. 67% of fund managers believe that the Shanghai Composite Index will rise between 3000 and 3500 by the end of next year.

By comparison, 66% of professional investors expect the overall trend of bond market in 2020 to remain stable. The structural inflation caused by the pig cycle and the goal of maintaining a stable macro leverage limit constrain the central bank's monetary policy regulation space, and there is little possibility that the bond yields will continue to decline significantly. But flexible and moderate monetary policy operation space will be more moderate. It is expected that monetary regulation will be stable growth next year, and interest rates will be limited. Under the fundamentals LED market, the bond market will continue to shake.

Outsourcing mode standardization

With the successive establishment of financial subsidiary companies, it is a new way for the information management industry to adopt the outsourcing investment ability.

For example, Jianxin finance signed a strategic cooperation agreement with more than 40 Chinese and foreign information management companies and some key branches in November 28th, such as CICC, Xinan world investment and so on. Zhao Yin financial management in December 3rd and Morgan asset management reached a strategic partnership, the two sides will cooperate in product development, investor education and capture the industry's emerging opportunities and financial technology.

In December 2nd, the CIRC issued the "net capital management measures for financial subsidiaries of commercial banks" (Trial Implementation), which will be formally implemented in March 1, 2020. Under the constraint of net capital, the "non-standard" scale of financial subsidiaries can be limited. Insiders pointed out that the requirements of different asset risk coefficients are good for investment standardization assets. At present, bank financing funds are mainly fixed income bonds and other investments. In the future, it may increase the allocation of equity assets and other equity assets.

In terms of outsourcing, before 2014, the outsourcing bodies were dominated by big actors, and the cooperative bodies were mainly head dealers and funds. After 2015-2016 years of "barbaric" growth stage, there are frequent risk events. After 2017, with the introduction of a series of regulatory documents such as the new regulation of information management, the entrusted investment market was gradually standardized.

At present, the outsourcing agencies are mainly small and medium sized institutions, and the trustees also begin to split up. Many trustees have gradually withdrawn, but some of the head offices have not been reduced. The selection of investment is more and more standardized, and the former pays more attention to the investment. Now it is very concerned about before, after, and after the investment. Chen Yong, general manager of Ping An Trust fixed income team, told reporters.

"When a private institution was established or a small organization was found, four or five people could take the" outsourcing ". Now the runway is standardized, and the entry threshold has also been improved. " Chen Yong said, the Commission will ask, "the brake outside the committee is not good enough, the throttle is like, whether the racing driver has any achievement". The threshold is getting higher and higher, and the "moat" is getting deeper and deeper. "The development trend of outsourcing in the future is increasing polarization and concentrating on the head office."