Global EditionASIA 中文雙語(yǔ)Fran?ais
    Business
    Home / Business / Finance

    Investors shrug off central bank's monetary policy move

    By Chen Jia | China Daily | Updated: 2018-06-11 07:42
    Share
    Share - WeChat
    Customers of banks use ATMs at a public spot in Fuzhou, Fujian province. Shares of commercial banks fell on June 4, the first trading day after the PBOC announced changes to some monetary policy aspects on June 1. [Photo/China News Service]

    Bank stocks fall as PBOC's quasi-easing on June 1 seen as being silent on rates

    The quasi-easing of China's monetary policy on June 1 has not encouraged investors to raise their holdings of stocks of commercial banks, market sources said.

    Expected further freeing of interest rates has not yet happened but still remains on financial regulators' reform agenda. It is a painful phase that the lenders cannot overlook, they said.

    Hence, the market sentiment toward bank shares has not brightened in the wake of the June 1 move by the People's Bank of China, they said.

    On that day, the central bank announced it will expand the range of financial instruments that can be pledged when commercial and policy banks borrow money through the medium-term lending facility or MLF.

    The MLF is an innovative monetary policy tool to inject base money into the financial system and ease tight liquidity conditions relating to seasonal factors.

    The next phase of reform, which is expected to give banks greater freedom to set their deposit rates, could lead to competition for people's savings.

    Typically, when banks vie for people's savings, they tend to accept a trade-off as part of the bargain-they sacrifice part of their profits.

    As a result, some banks, especially the smaller ones, may face pressure of insufficient capital and tightened liquidity, industry experts said.

    This scenario has implications for the A-share market. About 60 percent of the listed banks' shares dropped below their net asset value or NAV on June 4, the first trading day after the PBOC move to inject additional liquidity into the banking system.

    But market goings-on may not worry financial regulators as deleveraging and financial reforms are not their but policymakers' concerns.

    A research note from CITIC Securities said the June 1 move is to prepare commercial banks for the next stage of interest rates liberalization reform. Any such reform would "especially support small and medium-sized" banks and encourage them to lend to the real economy, CITIC said in its note.

    Industry observers said the monetary authority appears to be operating a "dual track" interest rate system comprising regulated interest rates and market-determined rates.

    The target of interest rate reform is to gradually remove the government's administrative controls on interest rates.

    Whether interest rates could play a significant role in effective resource allocation and transmission of monetary policy is a crucial criterion to assess a market economy, they said.

    The PBOC has developed an interest rate "corridor" to influence the relatively free market rates, with the interest rate on excess reserves of banks serving as the floor while the interest rate on the standing lending facility or SLF as the ceiling.

    Commercial banks, however, could suffer more headwinds this year when financial regulators start to assess their capital adequacy ratio under a new framework.

    They are also under pressure to shift away from off-balance-sheet business, or to crack down on high-risk shadow instruments such as wealth management products, said Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group, a subsidiary of Caixin Insight Group.

    After his China visit in late May, the International Monetary Fund's First Deputy Managing Director David Lipton issued a statement that China should take advantage of the current growth and reform momentum, especially when the financial sector reforms have made strong progress recently, in order to achieve the goal of high-quality growth.

    Lipton made those remarks after policy discussions with Chinese Finance Ministry officials. He said the monetary policy needs to become more price-based rather than quantity-based, and this transition should be continued, just as "to fix the roof while the sun is shining".

    Top
    BACK TO THE TOP
    English
    Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
    License for publishing multimedia online 0108263

    Registration Number: 130349
    FOLLOW US
    CLOSE
     
    久久亚洲AV无码精品色午夜 | 亚洲国产精品无码久久SM| 好硬~好爽~别进去~动态图, 69式真人无码视频免| 中文字幕亚洲欧美专区| 精品欧洲AV无码一区二区男男| 免费无码国产欧美久久18| 天堂√中文最新版在线| AAA级久久久精品无码区| 亚洲熟妇无码乱子AV电影| 人妻精品久久久久中文字幕| 中文在线最新版天堂bt| 人妻系列无码专区久久五月天 | 成人无码网WWW在线观看| 一级中文字幕免费乱码专区| 中文字字幕在线一本通| 中中文字幕亚洲无线码| 国模无码一区二区三区| 88国产精品无码一区二区三区| 日韩人妻无码一区二区三区久久| 精品人妻无码区二区三区| 精品亚洲AV无码一区二区三区 | 青娱乐在线国产中文字幕免費資訊| 久别的草原在线影院电影观看中文| 久久久久亚洲AV无码去区首| 韩国免费a级作爱片无码| 无码囯产精品一区二区免费| 亚洲va中文字幕无码久久不卡| 免费看又黄又无码的网站| 伊人久久综合无码成人网| 中文字幕丰满乱孑伦无码专区| 无码人妻丰满熟妇区BBBBXXXX| 狠狠躁天天躁中文字幕无码| 免费a级毛片无码a∨免费软件| 亚洲中文字幕久久精品无码喷水| 97无码人妻福利免费公开在线视频 | 人妻无码人妻有码中文字幕| 人妻丰满熟妇aⅴ无码| 亚洲韩国精品无码一区二区三区 | 无码精品人妻一区二区三区免费看 | 亚洲国产精品无码中文字| 日韩中文字幕欧美另类视频|