Is the era of interest rate acquisition over? What is the significance of Shanghai's banking move? Shanghai Bank | Interbank | Times
Recently, the Shanghai Banking Association formulated and released the Self Discipline Convention on Creating a Sustainable Credit Market Environment for the Shanghai Banking Industry. The Self Discipline Convention emphasizes that member units should adhere to the general principle of seeking progress while maintaining stability, operate in accordance with the law and regulations, based on changes in the interest rate market and the strategic positioning of the bank, adhere to the principle of deposit to loan, play the guiding role of LPR in loan interest rates, and reasonably determine the pricing level of interest rates. Interest rates should not be used as a single means to attract customers, while balancing the social responsibility and commercial sustainability of banking institutions, and maintaining the bottom line of avoiding systemic risks.
The scope of application of the Self Discipline Convention refers to all member units of the guild engaged in credit business, in other words, basically all banks in Shanghai. So, what is the significance of Shanghai's banking industry's move?
The era of interest rate acquisition has passed
In fact, lowering the interest rate threshold to attract customers is not a long-term solution for banks. A healthy, sustainable, and conducive credit market environment for the development of the real economy cannot be formed solely by lowering the interest rate threshold. Chen Qichang, President of the Shanghai Banking Association and President of the Agricultural Bank of China Shanghai Branch, explained that the banking industry shoulders the mission of supporting high-quality development of the real economy. At the same time, the banking industry should also attach importance to achieving its own high-quality development goals. The profits of banking and financial institutions themselves should be able to meet the needs of endogenous capital supplementation, and should handle the three major relationships of capital and end, specialization and comprehensiveness, and quality and quantity, adhering to the origin of financial services for the real economy. Therefore, the Shanghai Banking Association has formulated and issued the Self Discipline Convention.
"The era of relying on interest rates to attract customers has passed," Zheng Han, General Manager of Shanghai Bank's Inclusive Finance Business Unit, strongly agrees with the Self Discipline Convention. "For example, when we come into contact with a state-owned enterprise with a large number of upstream suppliers and lend to them, we will look at their transaction situation. If there are fewer default situations, the interest rate pricing can be lower, while if there are more default situations, the interest rate pricing will naturally be higher."
According to Zhu Shouyuan, the Business Director of Shanghai Bank, the loan interest rate pricing of Shanghai Bank is based on factors such as the risk and credit situation of various customer groups, loan project types, loan terms, and risk mitigation. Based on the principle of deposit to loan, it comprehensively considers factors such as loan related capital costs, risk costs, and capital costs to achieve a balance of risk, cost, and return. Loan pricing is dynamically adjusted according to changes in market interest rates, fully leveraging the guiding role of LPR in loan pricing. In pricing, Shanghai Bank will also fully utilize financial technology to accelerate the process optimization and digital application of pricing management. Optimize loan pricing models, strengthen system construction, coordinate the relationship between scale growth and pricing from different levels, adhere to market orientation, and timely analyze and adjust pricing competition strategies.
"We will actively maintain the order of the credit market." Zhang Xiaoqi, Vice President of the Shanghai Branch of Industrial and Commercial Bank of China, stated that we will adhere to the principle of optimizing investment and loans, and implement differentiated and refined loan interest rate pricing based on different loan products, amounts, terms, customers, and other factors. We will dynamically adjust loan pricing strategies based on changes in the interest rate market, ICBC's strategic positioning, and the competitive situation among peers, taking into account the social responsibility and commercial sustainability of banking institutions.
What else besides interest rates
"In the current customer acquisition process of banks, interest rates are indeed an important factor, but not a decisive one." Zhang Xiaoqi gave an example, "Compared to high or low interest rates, some enterprises with longer industrial chains value the comprehensive service capabilities of banks more. Some small and micro enterprises pay more attention to the suitability and ease of use of financial products, such as using loans if they want to use them today and repaying them if they want to use them tomorrow."
Whether it can help enterprises improve operational efficiency has become the key to attracting customers for banks today. In view of this, Industrial and Commercial Bank of China Shanghai Branch provides differentiated services to different customers and strives to promote communication among customers in the same industry or industry chain, and even become new partners. If the bank formulates a list of high-quality manufacturing industries, optimizes manufacturing business processes, and effectively accelerates related businesses. We have established an independent rating system and proactive credit measures for science and technology innovation enterprises, and have also launched products such as research and development loans for science and technology innovation enterprises and intellectual property pledge loans, striving to solve the problem of initial funding difficulties for science and technology innovation enterprises.
Shanghai Bank also provides precise product services for different customer groups. Build a small and micro product system that covers guaranteed fast loans, mortgage fast loans, scenario fast loans, and credit fast loans, providing a good financial experience for small and micro customers. Actively serving the medium and long-term funding needs of manufacturing enterprises for purchasing factories, and launching factory loan business. Establish a science and technology innovation "investment linked loan" product, and work together with various professional investment institutions to serve high-quality science and technology innovation enterprises.
Chen Qichang stated that in the future, the Shanghai Interbank Association will focus on key areas such as technology finance, green finance, and inclusive finance, guide member units to increase loan disbursements that are in line with the national industrial development direction and support Shanghai's key development industries, strengthen supporting financing support for special bonds, policy oriented development financial tools, and fully support livelihood improvement and urban renewal projects, actively provide high-quality, efficient, preferential, and personalized financial services for small and micro enterprises, promote credit sunshine, and establish a symbiotic and mutually beneficial relationship between banks and enterprises.
