In fact, the early termination of unexpired financial products by banks is not a special case this year. It has appeared as early as 2018.
According to the statistics of Puyi standard, from the beginning of 2018 to October 22, 2020, there are 1618 products in the bank financing market that have been terminated in advance. 1523 of these products were terminated after the release of the new financial regulation, accounting for 94.13%; 785 products were terminated earlier this year, accounting for 48.52%.
Since 2019, banks have begun to speed up the withdrawal of part of the stock financing, involving 622 products, a significant increase compared with 2018.
Yu Kang, a researcher at Puyi standards, told reporters of the 21st century economic report that the main reason for commercial banks to terminate part of their financial products ahead of time is that the new rules on asset management and financial management break the requirement of rigid deposit.
After the release of new regulations on asset management and financial management, banks are required to implement net value management of financial products. With the transition period approaching, banks have accelerated the liquidation of old products that do not conform to the regulations. Yu Kang said, in addition, the prices of existing old products are relatively high, and most of them still have the pressure of rigid cashing . However, the current market interest rate remains at a low level, the cost of capital is low, and the income of new investment products goes down, so it is easy to see the cost and income hanging upside down. Therefore, in order to control the cost of capital, some banks have taken timely measures to terminate the operation of high-yield products.
A bank staff member told the 21st century economic report that the early termination of financial products was mainly due to the impact of the new rules on asset management and the strict control of interbank market. The new regulations on asset management have broken the rigid cashing, the inter-bank lending rate has increased, and the low-risk loans have been significantly reduced, thus increasing the pressure on banks.
A bank financial staff told reporters: our bank started to prepare to stop very early, and it is also the old products will not be renewed after the expiration.
For example, some financial products with capital preservation will not be sold after the expiration of this month. The above-mentioned staff said, the new regulations on asset management have been introduced in 2018, and the banks have been prepared for it. We planned to stop selling capital guaranteed financial management at the beginning of this year, but it was only delayed for half a year due to the impact of the epidemic.
Many people in charge of bank financial products asked by the 21st century economic report believe that the interest rate (risk-free interest rate or LPR) is in the downward period, and it is likely that interest rates will remain low for a long time, as in the United States. There is indeed cost pressure in banks.
The so-called breaking the rigid cashing means that financial institutions should not promise to guarantee the principal and earnings when carrying out asset management business. When cashing is difficult, financial institutions shall not advance funds in any form to cash or carry out asset management business on the balance sheet.
The new regulation also requires that the proportion of non-standard allocation in financial products should not be too high. In this way, if banks can not adjust their asset allocation in time, financial products will not come out.
How to deal with it?
When asked about the pressure on the banks capital, the above-mentioned staff member said that although her bank did not terminate the wealth management products in advance, some recently due net worth financial products did not achieve the expected returns at that time, that is, they did not reach the performance comparison benchmark.
Since this year, banks have generally begun to speed up the pace of non net worth financial products. At present, the process of net value transformation of bank financial products is more than half, and the transformation enthusiasm is high.
According to the survey and statistics of Puyi standard, by the end of June 2020, the surviving scale of net value financial products was about 13.24 trillion yuan, with a year-on-year increase of 67%, accounting for 53.82% of the total remaining balance of all financial products, and the net value transformation progress of bank financial products was more than half.
The 21st century economic report reporter noticed that banks have the right to terminate financial products in advance in a number of randomly selected financial product agreements.
As shown in Article 8 failure to establish and early termination of financial products in the description of a certain financial product, the bank has the right, but not the obligation, to terminate the financial product in advance according to its own reasonable judgment in case of the following situations during the existence of the financial product.
The situations include: significant adjustment of national policies and influence on the normal operation of the financial product; large fluctuation of market income, risk of investment object or other reasons, which may or substantially affect the investment income realized by the product; the asset invested in this product is terminated in advance, and other banks think that the financial product should be terminated in advance.
The new regulation of asset management is included in the category of national financial policy adjustment as early termination of financial products. In this case, how should banks and investors respond?
In Yukangs view, the transition period of the current new asset management regulations has been extended to the end of 2021. After the transition period is extended, commercial banks should first rectify and standardize the existing old products, and there is no need to terminate the operation of products in advance to damage their reputation. If the rectification can not be completed in the transitional period, commercial banks should fully communicate and negotiate with investors. In addition, it can also help customers to choose alternative products to undertake due funds and avoid customers losses as much as possible.
A legal related person pointed out to the reporter of the 21st century economic report that whether the bank has the right to terminate the financial products ahead of time depends on the specific agreement. And the reason for the early termination of banks is the introduction of new regulations on asset management, breaking the rigid cashing, which can also be said to be affected by policy adjustment. In this case, it is reasonable for banks to terminate contracts in advance. For investors, the investment risk does not increase if the principal and the interest due can be recovered.
Source: Chen Hequn, editor in charge of economic report in the 21st century_ NB12679