shenzhen commercial bank lending rates up to 17%
in the case of bank lending restricted, banks ' lending rates higher than the benchmark interest rate rise above 50%, which means annual interest rates of more than 10%. while standard chartered's "small loans without collateral", average annual interest rates of up to 17%, almost folk debit and credit interest rates.
number of listed bank's pre-increase announcement, although lending is limited, but the bank's interest margin continues to increase, coupled with the tax reform policies, release provision, factors such as increased business in the middle, so bank still maintained rapid growth in the first half of the performance.
interest rate is too high, you feel that sme is more difficult, but increases the risk of bad loans. a joint-stock bank senior told reporters, in the near future, bad loan rates did not rise significantly, because of delayed effects, if any, have to wait until next year.
high loan interest rate
"only very high quality business loan rates get to benchmark interest rates, most companies in the benchmark interest rate interest rate rise on the basis of 20% and 30%. "a chinese investors in smes in the bank of china shanghai branch general manager, told the newspaper, how much lending rates in fact depends on a company's assessment of the situation. the special quality, lending rates are low, whereas loans with high interest rates on average, business loan rates in the benchmark interest rate floating around 20%, 30%. usually loan annual interest rate at around 10%.
banks are operating risk of enterprise, has always been the "icing on the cake", not "bread". so in quality enterprise built around the walls, these walls are banks that banks want to quality enterprises get a piece of the action. smes, for lack of collateral, are often neglected. one banker told reporters, collateral in the enterprise on the market today is so limited, because all the banks "robbed". without the mortgage enterprises, banks are afraid of the risk is too high and does not dare credit.
however, overall, bank lending restricted, so that banks have sufficient room for selected enterprises. newspaper reporter was informed that according to the investors, have not reduced the workload of the personnel and of the loan department, but were busy assessing, selecting customer. competition, only very high quality companies could also get a benchmark interest rate, and most of the business loan interest rates to float. another deputy general manager of the shanghai branch of the bank in retail banking, mortgage rates on the market up as much as benchmark interest rates rise above 50%, the annual interest rate can reach 12%, 13%.
spreads to increase bank performance;
spreads on such increase became a significant increase in the bank's performance of one of the most important factors. banks have reported increases in the publication notice in icbc, for example. increase reported earnings on july 4 announcement, january 1, 2008 to june 30, 2008, the performance of the industrial and commercial bank rose sharply in the same direction. expected net profit in the first half of 2008 rose above 50%. its performance increased due to the good momentum of development of the first half of 2008, net interest income, fees and commissions net income and other operating income increased rapidly, and because of the implementation of the new income tax rates and banking profits rose sharply in the same direction.
chen shuixiang, cic securities banking analyst in a research report that icbc, due in the second quarter loan and bond prices rising yields on interest-bearing assets continue to increase. meanwhile, tightening expected of the whole bank improved bargaining power, the new lending rate has been improved. he predicted its net profit for the year was 2.82%, compared to 2007 increased 8 basis points.
and on the other hand, tightened lending loans reduced, seems to be a negative bank profits. but, in fact, in actual operation, through a variety of ways to avoid regulation of the central bank. for example, have loaned assets through the designed to sell financial products to investors, thus vacated the new line of credit for lending by financial products, but also increasing intermediate business income. through credit cooperation, disguised loans.
on the intermediate business income, on the surface, due to sluggish capital market, sell the significant decline in the number of funds. but in practice, banks sell insurance, settlement business for the enterprise, such as rising incomes, fee and commission income also increased, so that in intermediate business income has experienced a significant growth.
in addition, the tax reform in 2007 and the bank's provisioning coverage ratio increased in the case of bad loan rates have not rebounded, credit costs decline. a case study of china merchants bank, chen shuixiang believes that china merchants bank 2007 provisioning coverage ratio reached 180.39%, in all listed banks after the bank of ningbo and shanghai pudong development bank, rebound in bad loans is not scenario, china merchants bank credit costs in the medium term is expected to be maintained at a low 0.3%, 0.83% have a larger decline than a year earlier.
net interest margin is the average interest-bearing assets the yield difference between the average debt cost rate, are important indicators of bank profitability. later, in the context of the credit crunch, bank lending rates must rise, the net interest margin is positive. however, the deposits will increase the cost of capital on a regular basis, loan to deposit ratio will reduce the rate of return on assets, may let banks net interest margin to turning.