China's banking industry under financial crisis "The financial crisis China's banking sector under the" Summary of Ma Weihua 2009.6.5 * Shenzhen Comprehensive Development Research Institute A 30-year achievements of China's banking sector 1, reform within the system: the functions from the People's Bank of changes in agriculture, industry, construction, cross five state-owned bank opened 2, outside the system reform: A Case Study of China Merchants Bank (1) "a little earlier than others, faster, better," more than the industry would like something more, and take one step ahead. Two classic cases: First, "Card", the cards are deposits is 2.8 times that of other bank card; Second, "Internet Banking", the current replacement rate is 70% of the business, broke through the limitations of physical network is limited, specific training groups of customers. In the credit card business, the earliest to do, and the United States initially declined proposals for cooperation, the first 4 years have been profitable credit card business focus now is no longer issuing volume, turning profits, the current consumption of 40% from the advance of Li Xi income. (2) CMB some ideas: i line with the philosophy on foreign capital is still a gap; ii grasp the scale of reasonable rate of expansion, risk control, does not exceed the management capability; iii-effective growth of growth is more important than size; iv treatment of market rationality and rational treatment of the industry, rational treatment of their own; v knowledge change, follow the value-oriented branch of the assessment is no longer 2009, the carrying amount of profits in the traditional examination, turned to the economic profit includes capital consumption to assessment, to guide the focus turned to the middle of low-cost small business and retail customers vi bank, domestic and overseas experience, only 30% of the integration is successful (Editors note: Type M can refer to HSBC article) vii corporate culture is the core competitiveness; ? Second, the impact of financial crisis 1, China's banking sector because of "wading shallow" toxic assets held by small, little direct impact, not "water well." 2, the current American consumption habits change. Before the crisis, liabilities and assets of each family is 133% higher than, the recent discovery that their savings rate has risen to about 5%. 3, a sharp decline in exports impact the real economy, transmission to micro enterprises, commodities, and employment links. Effectively reduce the demand for credit; interest margin; interest costs; intermediate business weakness. ????Opportunities for the financial crisis on banks, see the enclosed article, "Ma Weihua: Crisis Opportunity Chinese Banking Ten" article. ? China's economic recovery and long-term bullish on the expected number of reasons: 1, post-industrial era, the labor-intensive to capital-intensive; 2, the process of urbanization, 30% of the current urbanization rate is expected in the next few years 70% 3, consumer revolution, changes in consumption concept, such as the younger generation of overdraft consumer behavior; 4, regional economic imbalances, the local government organizations, the motivation and capacity for economic development China's banking sector faces challenges: 1, financial disintermediation, direct capital market development potential, bond financing, IPO financing on the impact of the traditional credit financing; 2, payment platform, the rise of the third party payment such as Alibaba's Alipay; 3, the test of interest rate market pricing power; 4, information transformation (such as smart grid development trend of information) 5, international, cross-border acquisition of a substantial increase in the first half, the customer has been going out. ? 3, Q & A session Q: acquisition of Wing Lung Bank, if the price is too high, and the current situation of business development M: the significance of the acquisition of Wing Lung: no institution in Hong Kong before, but now 40% of China Merchants Bank customers in southern China, and Hong Kong customers Households on the Mainland also needs; ????Purchase price: from recent transactions of view, to fully acquire banks in Hong Kong to get, and PB Basic 3 So, if prices decline, etc., are not necessarily the original shareholders will sell. ????Business plan on the Wing Lung: 1 year results were integrated, 3 Bian Yang (China Merchants Bank into the system), the success of 5 years; present in 2009 Q1 had been profitable, and better than expected; ????Wing Lung's business support: "Hong Kong-Guangdong Link" product development services, John Lonka in Mainland China Merchants Bank all network access is the credit card the same as China Merchants Bank credit card, in the Wing Lung's assets can be secured within the Merchants Bank loans, in the territory of China Merchants Bank's assets Loans can be secured in Hong Kong, etc. Q: Commercial banks in the tide of the current round of credit expansion lagged far behind the state-owned banks, how to respond? M: There is no natural advantage of the wholesale business, continue to emphasize the difference, such external pressure can promote internal change, adjust the business structure, grasp the opportunity to continue to maintain services and retail financial services for SMEs on the opportunities. ? Q: international next step? M: Integrated capacity is the key international management talent, management systems and management capabilities. Q: China Banking Regulatory Commission new outlets opening up commercial bank approval, CMB will accelerate the expansion of network M: before the plan will not change, the number of control 100 to open within the management decision to the rate of expansion. ? Q: Bank of Ningbo, Hangzhou Bank and Ping An Bank equivalent to industry competitive pressures? M: move the line a few advantages: a brand, service level, the "preconceived" advantage; 2 business overall advantage, not just a simple deposit-taking business, there are a variety of financial products, credit cards, loans, corporate banking business, business The more the higher loyalty, higher migration costs, interest on some of the benefits will not easily leave; 3. Cultural decided Service Advantage PS: Ma Weihua: crisis Ten Chinese Banking Opportunities Dialectical view of the global financial crisis on China's Commercial Banks Ma Weihua: crisis and opportunity is always accompanied, as long as firmly grasp the "crisis" in the "machine", "crisis" will become a turning point , ¡ö Merchants Bank Dr. Ma Weihua ????"At present, the financial crisis impact the real economy, has increasingly counterproductive to banks, domestic banks are faced with ever-increasing risk management and profit pressure. But it also contains many unprecedented opportunities," ?????We are experiencing this global financial crisis, its geographic scope, deep impact, impact strength, large, as the rarely seen since the 30s. In the past two years by the U.S. subprime mortgage crisis triggered by the financial crisis, rapidly penetrate the capital markets, money markets and credit markets, the development from local to global, from the financial sector spread into the real economy, to economic development and people around the world serious impact on life. ????At present, the further escalation of the global financial crisis, the global economic crisis highlights the growing trend. This continued for many years our investment and export-led model of economic growth, a great impact. Since late last year, China's economic growth rate fell sharply, industrial production slowed sharply, business is more difficult to increase revenue down, asset market downturn. Global financial crisis on China's economy has been conducted from the export sector to export- related raw materials, processing, spread from the developed coastal regions to the mainland in remote areas, spread from the small and medium sized state-owned enterprises Industry, China's economy is facing the new century, the most difficult time. ????As the domestic banking sector in the international market level is not deep, combined with recent years, commercial banks and capital markets and regulatory authorities to implement across the effective implementation of prudential policies and the current financial crisis on the direct impact of China's banking industry is not large, domestic direct losses suffered by banks is limited. However, Finance is a reflection of the economy, the economy is a problem, financial bound to go wrong. At present, the financial crisis impact the real economy, has increasingly counterproductive to banks, domestic banks are faced with ever-increasing risk management and profit pressures. From the business development perspective, the economic downturn, the market cooling, loss of confidence cases, bank financing as a social intermediary, paid intermediary and the intermediary function of wealth management to play both the company and the credit, personal credit and trade financing and other general loan business or company debt, trade debt and other liabilities on the public service; whether POS consumption, agency services, hosting trustee, to pay settlement class of business liquidation, or QDII, foreign investment, structured products, wealth management business, marketing is more difficult ; from the risks in the global financial crisis and economic downturn of the additive effect, the banks face the risk of constantly showing a systematic, chain and unexpected features and trends, including industry risk, credit risk, interest rate risk, liquidity risk, operational risk, compliance risk and reputation risk and other risks, including cross-cutting, interaction, bank a little mistake, it may fall into the abyss; from a profitability perspective, tends to decline in effective demand for credit, deposit continued narrowing of credit spreads, interest costs increased gradually in the middle weak growth, the gradual increase in risk assets, provision for such expenditure increased significantly this year and for the next period of time due to bank net profit growth will be slowing down, that kind of extraordinary growth will be difficult to reproduce the situation. ????However, the crisis also contains factors that opportunity, as Burejer British writer said, "Chinese 'crisis' is divided into two words, one meaning danger, the other meaning opportunity." Indeed, the crisis is always and opportunities accompanying the crisis in the organic, as long as good at finding good at grasping, firmly grasp the "crisis" in the "machine", "crisis" would be "turning point." From the look of things the law of development, everything is paradox, and contradictory forces of both sides as the situation will change the shift, also reversed the primary and secondary status, thus a qualitative change. The so-called "blessings in disguise Forest, Fu Xi disaster by V" say is the truth; from the economic cycle theory, economic always in accordance with the prosperity, recession, depression, recovery cycle of four stages of operation, the depression is the new after round of the recovery, the famous economist Joseph A. Schumpeter once said that "the crisis is no need to worry about, and to the market economy, the recession is a good jolt"; from the historical practice by many companies is as to seize the "crisis" In the "machine" and the development by leaps and bounds, such as the Great Depression, IBM's global rise of 70s last century, the Japanese auto industry after the oil crisis of the brilliant, post-Asian financial crisis, Samsung Electronics to take off, and so on. In short, the crisis will shake the old rules often led to change, becoming a major turning point in historical events. ????Although the current situation of commercial banks operating in China pose a serious challenge, but it also contains a lot of unprecedented opportunity. This is mainly reflected in the following areas: ????1, the state policy of expanding domestic demand and strong implementation ????In order to ensure stable and rapid growth of China's economy, the central and local governments in infrastructure, livelihood projects, ecological construction and post-disaster Chong Jian Deng Huge investment in and put Yi Jilie Cuoshijiakuai Tuijin urbanization, agriculture and industrialization process. This will greatly stimulate domestic investment demand and consumer demand expansion, 4 trillion funding and provide a corresponding credit demand, especially for the timely intervention and the expansion of banking platform for government financing, project financing, term loans, syndicated loans, etc offer new opportunities. ????2, the main structure of the market re-shuffle ????In the financial crisis, the survival of the fittest in the market mechanism will make profound changes in market structure, a new round of mergers among enterprises, restructuring of the wave will once again set off. The latest issue of Asia Pacific M & A Quarterly Thomson Reuters, the global M & A activity in other parts appeared in 2008, an average annual decline, trading volume fell 29.6% to 2.9 trillion U.S. dollars over the same period China's M & A activity remains strong and surged to a record high in 1596 100 million U.S. dollars turnover, compared with 44% jump in 2007, is expected to be 2009, this trend will continue. At the same time, the rise and fall turnover of the characteristics of the industry will also further highlights, including environmental protection, service outsourcing, electronic commerce, new materials, new energy applications, a large number of industries will rapidly rise. This not only broadens the bank M & A loans, financial consultants, business development space, but also expand the potential value of bank customers. ????3, the acceleration of the implementation of enterprise restructuring in transition ????To effectively deal with the crisis, businesses have changed business model, optimize product structure, strengthen the independent innovation, technology improvements and upgrading, and pay more attention to multi- product, multi-client, multi-channel, multi-marketing strategy. For example, in the more serious the impact of the financial crisis, the PRD region, private enterprises, especially small and medium enterprise initiative to adjust the pace of Pubian accelerated transformation, through the export of Zhuan domestic sales, improve product design, Jia Da research Touru other Shouduanjiasu Shixian from a manufacturing enterprise to market-based, innovative changes in business only six months, Dongguan City has 47 processing enterprises to the foreign-funded enterprises, 52 enterprises to actively carry out their own brands to create reporting; and Nanhai District, Foshan City, a district only had More than 200 successful transformation and upgrading of private enterprises. On the other hand, local governments at all levels, from the capital, land, taxation and other aspects to solve real business problems, reduce burdens, many preferential policies to support efforts of large, rarely seen in many years. Through its own upgrading and strong government support, the capacity of businesses to weather the financial crisis will be significantly enhanced. This reduces the bank's operational risks, but also help banks to better expand their business, especially medium and long term loans, equity financing, factoring accounts receivable financing financing business. ????4, residents of the dynamic adjustment of asset allocation ????With rising income levels and financial consumption of mind, financial needs of residents and the growing demand for wealth management, this trend is not reversed by the financial crises. According to incomplete statistics, last year, the scale of the domestic financial products sold more than 2.3 trillion yuan, the amount issued in 2007 to about 3 times. Moreover, with the market volatility, the residents pool their assets, pay more attention to structural adjustment, the dynamic adjustment of asset allocation will more. It is currently about 90% of that stock market volatility on bank savings deposits and interbank deposits of larger, it also fully embodies the distinctive dynamic asset allocation residents conversion feature. Therefore, as long as banks continue to enrich the product system and actively adapt to changes in customer demand, the current situation, wealth management and private banking, there is still great potential for development. ????5, the same pattern and competition strategy of quietly changing ????Many large foreign financial institutions in the financial crisis affected to varying degrees of impact or damage, so a number of high- quality high-end customers to choose the Chinese banks set up a business reputation of Chinese banks improved significantly. In the domestic banking market, many customers with the industry on the structure and business restructuring strategy, shrink or exit certain businesses and markets, and then for the other banks involved in the selective release of the corresponding space. In addition, the current funds, securities, trust and other non-bank financial institutions and commercial banks Baotuan winter markedly enhanced cooperation sense, this to the bank to better develop products with the industry to carry out cross-selling business and brings a great opportunity. ????6, the rapid development of direct financing tool ????In order to expand social investment and ease the pressure on enterprise funds, the government has increased the bond market expansion efforts, in addition to actively encourage enterprises to issue corporate bonds, corporate bonds and medium-term notes and other traditional bond products, but also actively promote the detachable bonds, floating interest rate bonds, Zhongxiaoqiye a collection of short-term financing bills and bonds, the development of new debt financing instruments. According to statistics, in 2008 the country, including corporate bonds, corporate bonds, short-integration of credit debt, including medium-term notes issued reached 943.3 billion yuan, 1.72 times in 2007, and this year is expected to reach a circulation of 1200 to 1300 billion yuan . Among them, the exchange market, corporate bond issuance could reach 150 billion yuan. In addition to vigorously develop the bond market, the Chinese government will also speed up the construction of multi-level capital market GEM and other new markets will accelerate the delivery. The rapid development of direct financing in the business of bank financing challenges, it also led the bank bond underwriting, financial advisory and other specialized investment banking business development, and further expand the cooperation between banks and space. ????7, accelerate the transfer of industrial area ????Increased costs and shrinking market in the double squeeze, the coastal areas of labor-intensive, resource processing industries gradually echelon moved to the Mainland, more factors of production will accelerate in the pursuit of profit, driven by the flow of higher marginal returns to the Midwest area. According to experts, large-scale industrial transfer of the eastern coastal areas is estimated at about 5 years to complete, by 2010, only Guangdong, Shanghai, Zhejiang and Fujian provinces and municipalities to change out of 4 industrial output value will reach 1.4 trillion yuan or so. This will undoubtedly provide complete financial services to banks, to better develop the Midwest market offers new opportunities. ????8, the spatial expansion of renminbi bonds ????In 2008, along with monetary policy tone from the "tight" to "moderately easy" changes in the bond market, the expected decline in interest rates and ample funds out of the wave, driven by rising market, bonds, the average annual investment in fixed income products earnings up to around 6.52%, much higher than the stock type of financial products, market bond investment boom. This year, in view of the macroeconomic situation even more serious, can be expected to continue easing monetary policy, prices will remain at low Shui Ping Ye Yun Xing, Chi Xu cut interest rates in the money market liquidity will Cujin Buduanshifang, which further optimized for the bank portfolio of RMB Zhaiquantouzi expand the long-term bond investment opportunities, improve the RMB bond portfolio yields and create a new environment. Regulators have launched a listed commercial banks to participate in the Stock Exchange bond trading pilot work, and actively study the inter-bank bond market higher income classes, which will substantially increase the degree of China's bond market activity and trading volume help banks further improve the bond investment channels, improve the investment income. ????9, cross-border corporate hedging, arbitrage increased demand ????In the current international commodity market and financial market trends confusing, especially in foreign exchange and gold markets exacerbate volatility, companies continue to increase the risk of cross- border operations, hedging and arbitrage demand also increases. According to an authoritative survey shows that China's foreign exchange hedging needs of the general on the rise, nearly 1 / 3 of the companies want banks to provide more exchange rate risk management products. This will help promote the bank of the foreign currency, from onshore and linkage within and outside the business in depth, promote the exchange differences on foreign currency, interest rate hedging value-added products, structural innovation and development. ????10, a good time to absorb the talent ????As the financial crisis, foreign financial institutions to a large number of layoffs, many overseas financial professionals have excellent choice for home employment. If held in Guangzhou by the end of December last year, "Chinese students studying in Guangzhou Science and Technology Exchange", a total of 30 countries and regions from the nearly 1,800 students to attend. Dr 51% of which, for the first time more than half of the total enrollment; the last of the comparatively few financial and legal professionals accounted for 15%, including 80 people who worked on Wall Street. Return of foreign talent is no doubt exacerbated the domestic supply of human capital is greater than the demand characteristics of a buyer's market for banks to identify, hiring of professional personnel, especially high-level financial professionals provides a unique opportunity. In short, the face of current challenges and opportunities, difficulties and hopes the situation, as long as we strengthen our confidence, the crisis in seeking machine, learn to use the dialectical unity of thinking to analyze problems, research methods, developing countermeasures, and insisted on "both prudent and positive ", the domestic banking sector will certainly be able to survive the economic winter, maintain a sustained healthy and stable development.
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