bonzaspins| Market share fell for 12 consecutive quarters, many banks sold funds at discounts

Perry, a reporter from the Securities Times.

In the list of the top 100 public offering fund sales and retention scale newly disclosed by the China Foundation AssociationBonzaspinsThe market share of banking channels declined for 12 consecutive quarters.

In recent yearsBonzaspinsThe securities channel is growing against the trend by virtue of ETF business, while the Internet platform is rising rapidly by relying on the advantage of traffic, which makes the bank channel feel "full of crisis" in the fund consignment business. Accordingly, the major banks also work hard to "promote" from the dimensions of reducing purchase fees and distributing C shares, so as to attract fund investors who are sensitive to fees.

More banks sell funds at discounts

Recently, Xiamen Bank issued a notice of "90% discount on designated Public offering Fund products", saying that in order to thank customers for their long-term trust and support, and to encourage investors to establish a long-term investment concept, customers who apply for or vote for designated public offering fund products through mobile banking channels before the end of 2024 shall enjoy a 90% discount.

At the same time, Hangzhou Union Bank has also recently launched a 90% discount on funds, which can enjoy a 90% discount on the purchase rate (except for individual funds) through the bank's harvest interconnection and intelligent teller machine purchase / subscription. The recommended products include Yi Fang Shanghai and Shenzhen 300ETF connection A, Castrol 500ETF connection An and so on.

An obvious trend is that in recent years, more and more banks have joined the "price war" of fund consignment, and more and more fund products have been brought into the "discount promotion zone".

In fact, as early as 2020, China Merchants Bank was the first in the industry to launch a 90% discount on the application rates for index funds and bond funds. In July 2021, China Merchants Bank announced again that it launched a differential rate system for public offering funds. The application rate for more than 1,000 equity funds will be reduced to 90% discount, while there are nearly 1,000 front-end C share funds that are free of charge.

After China Merchants Bank, more banks, such as Industrial and Commercial Bank of China, Ping an Bank, Industrial Bank, Huaxia Bank, and so on, have also joined the ranks of "discount promotion" to sell funds. on the one hand, the Internet platform is targeted to vigorously distribute and promote C-share funds without front-end application fees, and on the other hand, a 90% discount purchase fee model is launched for the A shares of key funds to attract investors.

In this regard, people from some channels believe that this is mainly due to the intensification of competition in the fund consignment market. Investors apply for funds in addition to traditional bank consignment, brokerage consignment, and fund direct sales, as well as the strong rise of the Internet platform, and the intensification of market competition also promotes the decline of fund fees.

Coverage of products is still limited.

It is worth mentioning that, compared with the universal discount of the Internet platform, the rate preferential activities of banks to the fund are mostly limited to some key cooperation products, and the coverage is still small.

For example, Xiamen Bank, which recently announced preferential fund purchase fees, pointed out in the announcement that the rate discount is limited to eight designated funds, and these eight funds are index funds. Minsheng Bank, which announced a 90% discount on the front-end purchase and fixed investment rates of some funds at the beginning of this year, has only covered 13 products, including Wells Fargo quality Development, Huaan Media Internet A, and Guangfa Xinxing. Even China Merchants Bank, which started the fund rate discount earlier, did not achieve a large proportion of discount coverage. In its "five-star selection" main promotion fund, there are still many active equity funds whose application rates remain at 1%.BonzaspinsA normal level of .5%.

Some people in the industry said that at present, the fee reduction of major sales institutions is a spontaneous market-oriented behavior, so there are many structural problems. In the future, with the gradual landing of the rate reform policy, the fund sales market will be further standardized.

In July 2023, the CSRC issued the work Plan for fee Reform of the Public offering Fund Industry, which plans to take 15 measures within two years to promote the rate reform in stages according to the implementation path of "management fees-transaction costs-sales costs". The third step is to focus on fund sales and further standardize the fees of sales links such as subscription rates.

Overall decline in the retention scale of consignment sales

Relying on the advantages of the number of outlets and customer resources, the bank channel has always been the main force of fund consignment, but with the rapid rise of the Internet platform and the explosive growth of ETF business in the brokerage channel, the fund consignment business of banks is facing great challenges, which may also be a major reason for banks to "discount promotion" to sell funds.

According to the statistics of the top 100 sales and retention scale of public offering funds recently disclosed by the China Foundation Association, by the end of the fourth quarter of 2023, the number of stock mixed funds held in bank channels was 2.Bonzaspins.29 trillion yuan, a decrease of 235.6 billion yuan compared with the third quarter, down 9.32% from the previous quarter, and the market share fell by 1.90pct to 45.69% from the previous quarter, the 12th consecutive quarterly decline since the China Foundation Association released the top 100 list in 2021.

Of the 24 banking institutions on the list, 23 had a month-on-month decline in the size of their equity funds in the fourth quarter of last year, and 14 banks had a month-on-month decline of more than 10%. Shanghai Agricultural Commercial Bank, Guangdong Development Bank and Bank of Shanghai have even dropped by more than 20%. Only HSBC's stock fund has remained stable.

In addition, the recently disclosed annual reports of listed companies also show that the income of a number of banks' consignment funds shrank in 2023.

For example, the income of the agency fund of China Merchants Bank in 2023 was 5.179 billion yuan, down 21.52% from the same period last year. The bank said that it was mainly due to the downward shocks in the capital markets, and the retention and sales of equity funds with higher fees declined compared with the same period last year. The Agricultural Bank of China is no exception, with fund sales of 203.417 billion yuan in 2023, down slightly from 205.485 billion yuan in 2022. In addition, China Construction Bank also said in its annual report: "Fund underwriting is affected by fluctuations in the capital market and fee reduction policies, and income has declined."