Power Trader to save money Fund: Deposit move Force Bank to challenge

The money fund's powerful "gold-sucking" ability is leveraging the "Big Cheese" of bank demand deposits.

Recently, Tianhong fund announced the "Balance treasure" scale to break through the hundred billion mark, the state investment UBS began to try to use the goods base generation wages; Minsheng Bank United Two fund companies to launch electronic bank cards, customer demand savings can be directly linked to currency returns ... The pace of alternative demand deposits by the fund has been accelerating.

With the power of the money fund to take advantage of, the bank deposits "moving" seems to be menacing. But will commercial banks easily exit their own positions? What should banks do if they are unwilling to cede the "source of profit"?

Deposit "Move"

"Balance treasure" and other monetary Fund products are in demand deposit field "happy enclosure."

Online only a short period of 5 months, the days of Hong-Li Bao will become the first domestic fund history only to break through the billions of funds, "balance treasure" the number of users nearly 30 million households. Ranked 51st in the Global Monetary Fund.

Industry insiders believe that money funds are moving into ordinary people's homes. Not only is it more attractive than demand deposits in the yield, its t+0 liquidity is comparable to demand deposits, and the emergence of many types of "surplus treasure" products has greatly improved the convenience of using money funds. In addition to the introduction of public-oriented Monetary Fund products, fund companies are actively docking banks and companies, hoping to further promote the use of money funds to replace demand deposits.

The reporter learned from Minsheng Bank that the bank has combined to add rich, Minsheng Two fund companies, the proposed introduction of a new electronic bank card, users will deposit money into the electronic bank card, the current savings directly linked to the money, the expected annual return rate of about 5%.

The transfer and transfer of funds for the electronic bank card is free of charge and is supported at any time, and the user experience is no different from a current account. This is also the Minsheng Bank Direct Sales Bank launched a new product, has entered the beta phase, is expected to launch in December.

Household deposits declined by 896.7 billion yuan in October this year, according to the central bank's report on financial Statistics October 2013, released recently. Some industry analysts said, "Deposit move" in addition to seasonal factors, the Internet financial diversion of the impact of deposits can not be underestimated.

"China's current situation with the United States in the the late 1970s is very similar, has formed a deposit interest rate marketization mechanism, which means that China's deposit interest rate marketization will accelerate, is currently the golden opportunity of the development of money market funds." "Oriental Securities analyst Jinlin said.

He said that when the U.S. banking industry is facing the second oil crisis under the impact of high inflation to promote money market yields continue to rise, and continue to pull the interest rate on the ceiling of deposit rates spreads. At present, the spreads between China's money market funds and deposits, especially demand deposits, have widened markedly. "And, in the late 1970s, US money market mutual funds began to have the function of paying, while China's money market funds are tightening up with popular internet portals. Both reduce the hidden costs of using money-market funds. "Jinlin said.

A profit-making yell?

"We have been working with banks since last year to link demand deposits with money funds," he said. The reason the fund companies want to do this is because of its huge market potential, which is larger than demand deposits in the US Monetary Fund. "The head of the electricity business of a fund company said in an interview with the first financial daily.

The company's head of business further analysis said that the current domestic savings of about 80 trillion, of which about 16 trillion of the current savings, and the size of the money fund is only 400 billion to 500 billion. If money funds and demand deposits are on an equal footing with the US, it should be up to 40 trillion, that is, 100 times times more room for growth.

In fact, there are a few fund companies with such ideas. However, it is not easy to pry a demand deposit with this piece of cheese.

A fund manager told reporters that as early as 2010, his company had tried to work with a large state to link a demand deposit to the IMF, but it was not able to do so. The main resistance is that the first is to move deposits to reach the interests of banks; second, for banks, the cost of the business is too low; third, it system requirements are higher.

The 2nd is the main bottleneck, involving bank cushion funding. According to the fund manager, the general money-redemption process is that the customer submits the redemption today, the Fund submits the data to the managed bank, and the Custodian Bank liquidation fund returns to the fund company the next day before returning to the client.

"This is the traditional money fund t+1 process. Then, now to achieve t+0 real time to bring money to customers, you have to Xianchan. Now t+0 Money Fund products are the funds of their own cushion, limited in size, so the fund companies are talking to the banks, hoping that, like loans, banks to cushion the funds. The fund manager said.

"If a monetary fund to do tens of billions of dollars, the amount of the day will be up to 500 million or 600 million, the general fund companies must not be out, so must rely on banks to be bigger." "But the fund manager also said that for banks, the business is not only to occupy a large number of credit lines, and cushion the day interest is not high, compared with corporate loans, the business is too low earnings." In addition, the Money fund t+0, for banks and fund companies in the IT system requirements are higher, especially the two sides to achieve system docking, upfront investment time and cost are many. So banks have no incentive to do so.

In fact, not only the banks, but also the fund companies, the big Money Fund is not a direct increase in income is a good way.

"The reason the fund company is willing to make a profit is not profit but scale." "The above public offering business owner said that on the one hand, the fund management scale is crucial to the company rankings, on the other hand, with the growth of the money fund potential market space, customer resources is the fund company really value."

A Minsheng banker also told reporters that although the promotion of electronic bank cards, the use of money funds to replace demand deposits will be diverted to the original deposit business, but in the long run, it is expected to attract more bank deposits and customer resources.

Forcing bank reform

Although in the short term, the money fund replaces the demand deposit still to be heavy, but the class "the surplus treasure" the product to the deposit interest rate marketization promotion effect is obvious.

Jinlin that the deposit interest rate will be close to the money market interest rate after the marketization of interest rate is an inevitable trend. In contrast, the current deposit cost in China is obviously lower than that of money market funds, especially demand deposits will be the most important target of interest rate marketization.

In his view, the category "Balance Treasure" product will promote the formation of deposit interest rate marketization mechanism, bank deposit interest rate market pressure significantly increased, and Minsheng Bank launched electronic bank card is also a bank to deal with the interest rate marketization and media pressure of the major measures.

This September, Minsheng Bank announced cooperation with Alibaba Test Water Direct bank, as the new mode of banking in the Internet era, direct selling banks will not set up outlets, do not issue real bank cards, customers mainly through computers, e-mail, mobile phones, telephones and other remote channels to obtain banking products and services.

According to our correspondent understand, the Minsheng Bank intends to launch the linked Money Fund of the electronic Bank card is its direct selling bank products. "Instead of letting others to take our lives, we are not as good as ourselves." This has been agreed within the Minsheng bank.

The director of the above public offering business said that, although the same as the Money fund products, but Minsheng Bank products and "balance treasure" is very different, because there is a huge application site Taobao, "balance treasure" funds are basically in Alipay and "balance treasure" two of the flow of accounts, the user rarely really mention.

"But Minsheng Bank's electronic bank card, in terms of user experience, is basically the same as a demand account and can be used at any time." This also means that Minsheng Bank needs to prepare a large amount of money to cushion. If the scale is big, the pressure of Minsheng Bank is not small. The owner of the electric business said.

In addition to Minsheng Bank, many banks have begun to try to combine with the Monetary Fund in a number of small business areas.

Shing, a beijing-based fund company, says many banks have started working with fund companies in Shing. For example, use the liquidity of a large client to make a monetary fund. This is to give big customers some value-added services, on the other hand, is a small area to try to use the Money fund instead of deposits.

And in the credit card repayment aspect, the commercial bank and the public offering cooperation also is speeding up. such as GF Bank and Yifangda fund launched a new Cash Management intelligence tool-"smart Gold Account", that is, customers in the Guangdong Bank Online Banking simple operation, in the establishment of the minimum retained cash and the maximum amount of deduction, customer card in the current balance automatically into the currency of a currency fund, Then automatically repay the credit card on the date of setting the repayment.