This is the third time since 2019 that the central bank has offered a comprehensive reduction of the reserve ratio. Before this reduction, the central bank had two comprehensive reductions on January 4 and September 6, 2019, respectively. In January 2019, the central bank generally lowered the RMB reserve ratio of financial institutions in 35 months.
Release more than 800 billion yuan
In terms of the scale of funds released that the market is most concerned about, as in the last comprehensive reduction, the central bank also failed to recover liquidity at the same time. This comprehensive reduction of 0.5 percentage points is roughly the same as last September.
This reduction is a comprehensive one, reflecting the counter cyclical adjustment, releasing more than 800 billion yuan of long-term funds, effectively increasing the stable sources of funds for financial institutions to support the real economy, reducing the cost of funds for financial institutions to support the real economy, and directly supporting the real economy. Central bank officials said.
Although the reduction is slightly lower than the release of about 900 billion yuan in September last year (including about 800 billion yuan of total release funds and 100 billion yuan of targeted release funds), the reduction is more than the scale of each release of four times of reduction in 2018, and also more than the release of about 800 billion yuan in January last year.
The central bank said that the reduction of the reserve to maintain a reasonable and sufficient liquidity is conducive to the realization of the growth of monetary credit and social financing scale in line with economic development, the creation of a suitable monetary and financial environment for high-quality development and supply side structural reform, and the use of market-oriented reform methods to dredge monetary policy transmission, which is conducive to stimulating the vitality of market players and further playing the market in resource allocation To support the development of the real economy.
The overall reduction is 0.5 percentage point, which is in line with the market expectation. In view of the fact that there are 600 billion yuan reverse repos maturing in January, superimposed with tax payment, issuance of special local government bonds, cash demand during the Spring Festival and other factors, liquidity is under pressure. The 800 billion yuan released through the reduction can meet the above liquidity needs on the one hand, and on the other hand, the release of low-cost long-term funds is conducive to Reduce the capital cost of banks and guide banks to reduce the financing cost of the real economy. Wen bin, chief researcher of China Minsheng Bank, said.
Reduce the capital cost of banks by about 15 billion per year
This comprehensive reduction of standards is also in response to the requirement of Premier Li Keqiang to reduce the financing cost of small and micro enterprises.
Li Keqiang said during an inspection tour in Chengdu on December 23 last year that the state will further study and adopt various measures such as reducing and directional reducing the standard, refinancing and rediscount, reduce the actual interest rate and comprehensive financing cost, and promote the obvious alleviation of the financing difficulty and high cost of small and micro enterprises.
In response to reporters questions, the central bank also explained the gift package of small and medium-sized banks.
In this comprehensive reduction, only urban commercial banks operating in the provincial administrative areas, rural commercial banks serving the county, rural cooperative banks, rural credit cooperatives and rural banks and other small and medium-sized banks have received more than 120 billion yuan of long-term capital, which is conducive to strengthening the capital strength of small and micro banks serving private enterprises based on the local and returning to the source.
At the same time, the reduction of the standard reduces the banks capital cost by about 15 billion yuan per year. Through bank transmission, the actual cost of social financing can be reduced, especially the financing cost of small and micro enterprises and private enterprises.
LPR may decrease further in January
When asked whether the reduction of the reserve rate means a change in the orientation of sound monetary policy, the relevant head of the central bank denied.
According to the central bank, this reduction is a hedge against the cash investment before the Spring Festival. The total liquidity of the banking system will remain basically stable, flexible and moderate, rather than flooding. It reflects the scientific and steady control of the counter cyclical adjustment of monetary policy, and the orientation of stable monetary policy has not changed.
Some institutions believe that this reduction in reserve will offset the liquidity gap in January and guide LPR to further decline.
Industrial Research believes that the central bank will reduce the reserve ratio before the festival to make up for the gap in cash supply during the Spring Festival, create a stable liquidity environment for the upcoming issuance of local bonds, and guide the downward trend of real financing costs. The LPR may be reduced by another 5 basis points in January.
The latest loan market quotation rate (LPR) will be released on January 20.
From the reform in August last year to the fifth LPR quotation published on December 20 last year, the one-year LPR was reduced by 5 basis points in August and September respectively, while it remained unchanged in October, 5 basis points in November and December. After the first announcement of the five-year LPR in August, it did not decline in September and October, 5 basis points in November and December.
Wen bin also predicted that on January 20, the price of the new LPR would decrease slightly, with the LPR of 4.1% for one-year period and 4.75% for more than five years.