Chinese reporters of securities companies have noticed that deppon securities and Hengtai securities have launched fund purchase rate of 0.1, which means that it will directly affect the ranking of financial products sold on a commission basis. What are the considerations behind this? What is the impact on the industry?
Two securities companies launched fund subscription rate of 0.1%
Hengtai securities comprehensively promoted the application rate of public offering funds of 0.1 discount on September 9, 2020. In other words, the current product subscription rate is only 1% of the level of non discount channels (except for products whose minimum subscription rate is higher than 0.1% as agreed by the fund manager).
On the one hand, Hengtai securities has established a wealth management business strategy with buyer investment consultant as the core, and reducing the rate is the inherent requirement of this business strategy. In addition to reducing the rate, this year the company also increased efforts in product selection and after-sales service, including the launch of Hengtai xingxuan to manage the human body system. This is just like making investment. On the one hand, it can optimize the target, on the other hand, it can save the investment cost, so as to achieve better results in the end.
On the other hand, Hengtai securities hopes to expand its market influence in the third, fourth and fifth tier cities with insufficient coverage of financial services. Investors in economically developed areas are usually more sensitive to the rate, and have many ways to choose the investment channel with lower rate. However, China has hundreds of millions of people, most of whom are located in the third, fourth and fifth tier cities with underdeveloped finance, bearing high fund investment costs and few other options.
He believes that for clients, buying funds needs to consider pre investment and post investment, and consulting services for net worth products is an advantage of securities companies over other financial institutions. If the funds rate goes down, it can maintain its income and enhance its market competitiveness by promoting the transformation and upgrading of its investment advisory business.
In fact, as early as a few years ago, the major sales channels have begun to reduce the fund subscription rate, a discount rate has become a common phenomenon.
In 2016, ant upgraded ant treasure to ant wealth, reducing the subscription fee of all products to 10%. At that time, it was the first channel with the highest sales scale to reduce the rate.
In the same year after the ants, the daily fund immediately launched a comprehensive discount rate.
In October 2019, Tencent Financial Management will reduce the subscription fee of all products to 10%. Prior to this, the company had tried to pay a discount for the service charge when the balance was paid.
In August 2020,
China Merchants Bank
The app was officially launched in the index link special zone, and the 10% discount subscription rate was first launched. CMB has not reduced the rate before, mainly considering that its offline customer manager team has perfect pre-sale and after-sales service for the products. Directly reducing the rate will reduce the income source of the marketing team and reduce its enthusiasm.
It is worth noting that the above institutions only reduced the subscription fees, while the subscription fees for new products did not decrease.
Since the new regulations on fund sales no longer prohibit discount of subscription fees during fund raising period in 2013, fund companies have launched preferential activities of zero rate for fund subscription in the same year. Therefore, in the fund direct sales channel, the situation of 0% discount subscription is more and more common, but most of them are carried out in the name of limited time activities.
For the sales channel, the subscription fee is agreed by the fund company and the sales channel. Especially at present, the fund company pays more attention to the brand and some star products, hoping to highlight the scarcity of new products. Therefore, the fund company usually agrees with the channel no discount for some key new products.
Some people in the industry believe that fund rate reduction is the general trend. One is that, under the promotion of supervision, the funds rate is becoming more and more transparent, and the market competition is very fierce. The practice of relying on high-quality services to maintain high fees is good, but it is difficult to resist price competition. Especially for the traditional financial institutions, it is difficult to maintain the scale without reducing the rate; on the contrary, reducing the rate early can obtain the new scale to a certain extent. Second, the rise of index investment has a great impact on the original market due to the continuous development of new varieties of low fee rate in the whole fund industry, such as ETF, index fund, etc. Third, since the pilot project of mutual fund investment advisory was carried out, reducing the rate of fund purchase and redemption has become the theme of the topic.
After the reduction of product subscription fee, the income source of offline sales team of financial institutions will decrease. In what ways will this part of income loss be compensated in the future?
Second, in recent years, there are more and more index funds and long-term closed-end funds. Securities companies can negotiate with fund companies to exchange securities, that is, after the intermediate income of products is reduced, securities sources are introduced from fund companies for securities lending customers in the process of product operation, so as to convert sales revenue into interest rate income.
Can it stir up the sales of securities companies?
However, some insiders have analyzed that Debang securities and Hengtai securities directly give up the subscription rate, which will not attract other securities companies, especially the head brokers, to follow in a short period of time.
A senior brokerage of a securities firm in Shanghai analyzed to the Chinese reporters, the public offering fund market is a big year this year, and the sales agencies can share more interests from it. We may not have a strong driving force to substantially reduce the rate. In addition, most of the securities companies, especially the head securities companies, attach great importance to the ranking of sub businesses. If the rate goes down, it will have an impact on the ranking. Business strategy reflects the companys position on the interests of customers, employees and shareholders. Because each has different requirements, it will make different decisions.
According to the ranking of net income from sales of financial products of securities companies in the first half of 2020 released by China Securities Association, the top ten securities companies are all large-scale securities companies. CITIC Securities, Galaxy Securities and Huatai Securities took the top three, with a net income of more than 300 million yuan in the first half of the year. Some people in the industry have analyzed that, at the moment when the Matthew effect of industry competition is becoming more and more obvious, it is understandable that small and medium-sized securities companies give up part of their income for scale, but wealth management is ultimately a competition of professional service ability. The customers long-term holding experience may be more critical than price. Therefore, the actions taken by the above-mentioned securities companies to improve service after reducing the rate are more worthy of attention. At present, the securities industry is facing a wealth management market with multiple formats coexisting and a hundred flowers blooming. Source of this article: Zhang Mei, editor in charge of securities companies in China_ NF2100
According to the ranking of net income from sales of financial products of securities companies in the first half of 2020 released by China Securities Association, the top ten securities companies are all large-scale securities companies.
Some people in the industry have analyzed that, at the moment when the Matthew effect of industry competition is becoming more and more obvious, it is understandable that small and medium-sized securities companies give up part of their income for scale, but wealth management is ultimately a competition of professional service ability. The customers long-term holding experience may be more critical than price. Therefore, the actions taken by the above-mentioned securities companies to improve service after reducing the rate are more worthy of attention. At present, the securities industry is facing a wealth management market with multiple formats coexisting and a hundred flowers blooming.