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Original title: The interest rate of small and micro re-lending to support agriculture is reduced by 25BP, structural monetary policy tool, precise drip irrigation
Following the overall RRR cut, the central bank issued positive news. Starting from December 7, the central bank will cut the interest rate on refinancing loans for small and medium-sized agricultural enterprises by 0.25 percentage points. After the RRR cut, the three-phase, six-month, and one-year agricultural loan refinancing interest rates will be 1.7%, 1.9%, and 2%, respectively.
Dong Ximiao, chief researcher of China Merchants Finance and a part-time researcher of the Institute of Finance of Fudan University, said that the overall RRR cut is a holistic policy tool, while support for agriculture and small loans are structural policy tools. The combination of the two can better guide funds to support weak links such as "agriculture, rural areas and farmers" and small and micro enterprises to achieve precise control.
Regarding whether the policy interest rate that the market is concerned about will change accordingly, many experts said in an interview with a reporter from the 21st Century Business Herald that further observation is needed.
Structural monetary policy tools focus on optimizing the structure
On December 6, the central bank issued an announcement stating that in order to support the development of the real economy and promote the steady decline of comprehensive financing costs, it decided to lower the deposit reserve ratio of financial institutions by 0.5 percentage points on December 15. , 2021 (excluding the 5% deposit reserve ratio implemented by financial institutions). The RRR cut released a total of about 1.2 trillion yuan in long-term funds. Just as the market's previous expectations of targeted RRR cuts fell through, the central bank lowered the refinancing interest rate for agricultural and small enterprises to 25BP on December 7.
Refinancing is a monetary policy tool provided by the central bank to local corporate financial institutions that have specific requirements, including small business refinancing, agricultural refinancing, and poverty alleviation refinancing. , Credit poverty alleviation. Local corporate financial institutions are mainly small and medium banks such as city commercial banks and rural commercial banks. They have the local advantages of deep cultivation and flexible management. They are the main force serving the local economy and small and micro enterprises, and they are naturally inclusive.
"Following the overall RRR cut, the central bank lowered the agricultural and small loan refinancing interest rates by 0.25 percentage points on December 7, reflecting the pertinence and effectiveness of monetary policy." Wen Bin, chief researcher of China Minsheng Bank, pointed out that agricultural support The reduction in support for small re-lending interest rates will help reduce the cost of funds for small and medium-sized banks, and in turn will guide small and medium-sized banks to lower the loan interest rates for “agriculture, rural areas and farmers”, and better play the role of “precise drip irrigation” and “direct entity” of monetary policy.
In terms of "quantity", as of September 2021, the balance of agricultural refinancing of financial institutions was 474.7 billion yuan, and the balance of refinancing of small and micro enterprises was 993.7 billion yuan. From the perspective of "price", after this adjustment, the three-month, six-month, and one-year reloan interest rates will be 1.7%, 1.9%, and 2%, respectively.
In fact, "agriculture, rural areas and farmers" and small and micro enterprises are still weak links in economic development, and further financial support is needed. Wang Qing, chief macro analyst at Oriental Golden City, believes that the refinancing of rural small-scale refinancing supports the reduction of interest rates, mainly because the macro economy is facing new downward pressure. Small and micro enterprises still have the problem of high PPI-CPI scissors leading to rising costs. Need to increase targeted assistance. After lowering the refinancing interest rate for small and medium-sized enterprises, the bank's interest rate for inclusive financial loans to small and micro enterprises will also be lowered accordingly. After the financing costs of small and micro enterprises decrease, they will hedge the operating difficulties caused by high upstream raw material prices to a certain extent, which will ultimately help stabilize employment and stabilize macroeconomic operations.
However, the RRR cut can also reduce social financing costs. Why lower the refinancing interest rate for agriculture and small and micro enterprises?
China Everbright Bank analyst Zhou Maohua told the 21st Century Business Herald that in general, the RRR cut refinancing tools are aggregate policy and structural monetary policy tools. Comprehensive policies can help reduce the overall cost of liabilities of banks and guide the profitability of the banking system. However, the real economy's precise support for small and micro enterprises, agriculture and rural areas is not enough. The two complement each other and complement each other. Can effectively stimulate the vitality of micro-subjects.
Regarding whether the policy interest rate that the market is concerned about will change accordingly, many experts said in an interview with a reporter from 21st Century Business Herald that further observation is needed. Dong Ximiao said: "From a personal point of view, MLF may decrease, and LPR will also decrease. But after the macro data is released in November, we will make further judgments based on the changes in the data. I think there is still room for downward adjustment. And there is a lot of room for downward adjustment. necessary."
High efficiency and fast transmission of refinancing for small agricultural enterprises
As a structural monetary policy tool, refinancing has clear investment directions and interest rate requirements for the use of funds, and can direct financial resources to specific areas supported by policies such as agriculture and small and micro enterprises in the real economy. economy.
From the process point of view, the re-lending innovation adopts the repayment model of "loan first and then loan", that is, financial institutions first issue loans that meet the requirements to the enterprise, and then apply for re-loan funds from the enterprise. The People’s Bank of China equals. To a certain extent, the directness and accuracy of monetary policy have been improved. Previously, Liu Guoqiang, deputy governor of the central bank, pointed out that, compared with the traditional "loan first and then loan" model, the "loan first and then loan" model moved the loan approval threshold forward to achieve precise drip irrigation in key areas. At the same time, the People's Bank of China requires the bank to establish an electronic ledger to track and monitor the use of funds to prevent "dropping" of funds.
It is worth mentioning that since the People's Bank of China specifically performed the functions of the central bank in 1984, refinancing has always been an important monetary policy tool for my country's central bank. In recent years, the method of adapting to financial macro-control has changed from direct control to indirect control, the proportion of base currency refinancing has gradually declined, and important changes have taken place in the investment structure and direction. The newly added refinancing is mainly used to promote the adjustment of credit structure and guide the expansion of credit supply in counties and "agriculture, rural areas and farmers".
Currently, the statistical record of supporting agriculture and small-scale refinancing began in June 2014. In 2014, the Central Bank decided to adjust the classification of refinancing from the original three types to four types, that is, to further subdivide the original liquidity refinancing into liquidity refinancing and credit policy support refinancing, financial stability refinancing and special policy refinancing. Financing. The loan classification remains unchanged. After the adjustment, credit policies supporting refinancing include agricultural refinancing and small business refinancing.
At that time, the central bank pointed out in the monetary policy report that the establishment of a separate credit policy to support refinancing can better play the role of central bank funds in guiding the flow of credit funds, promoting the adjustment of credit structure, and strengthening the central bank’s credit guidance role in "supporting agriculture and supporting small businesses" . Agricultural refinancing and SME refinancing involve a wide range of objects, each with its own focus, and its pertinence has been further enhanced.
Among them, the target of small-scale refinancing was adjusted from the original city commercial bank to four types of financial institutions: city commercial banks (determined according to the statistical standards of the People's Bank of China), rural commercial banks, rural cooperative banks, and village banks. Adjust corporate loans and consumer credit, and support the above-mentioned financial institutions in granting loans to small and micro enterprises. In March 2015, the Central Bank issued the "Management Measures for Agricultural Refinancing of the People's Bank of China" to further regulate agricultural refinancing.
Zhou Maohua said: “The environment facing the economy is more complex, structural and cyclical overlap. Policies need to improve accuracy, quality and efficiency, balance growth and prevent risks. Re-lending is direct, special funds are dedicated, and policy transmission efficiency is higher., effective Fast. Lowering the refinancing interest rate for supporting agriculture is conducive to improving the efficiency of monetary policy transmission, accurately supporting weak links in the real economy, stabilizing employment, and promoting domestic demand."
In Wang Qing's view, refinancing to support the downward adjustment of agriculture and small and micro enterprises is a targeted interest rate cut. Targeted interest rate cuts should have the nature of a structural monetary policy, have relatively limited impact on the market, and will not drive market interest rates down sharply. In the short term, it does not mean that the central bank's 7-day reverse repo interest rate and MLF interest rate are represented by the central bank. The policy interest rate will be reduced accordingly.
"However, under the cumulative effect of the central bank's successive RRR cuts, LPR quotations in December may be slightly lowered by 0.05 percentage points (5 basis points)." He further pointed out that this will directly drive the decline of various corporate loan interest rates. On the whole, the targeted interest rate cut is superimposed on the overall RRR cut yesterday, indicating that monetary policy is being fine-tuned in the direction of stable growth.
(Author: Bian Wanli Editor: Bao Fangming)
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