Financial Association News, September 6th (Reporter Peng Kefeng): Recently, the discussion on whether the existing housing loan interest rates will usher in a new round of cuts has been heating up in the market. The core reason is that the excessively high mortgage interest rates in previous years have burdened residents, and lowering interest rates is beneficial for reducing the risk of loan defaults and easing the burden on residents.

So, is it urgent enough to lower the mortgage interest rates? Today, a Financial Association reporter found in the mid-year reports of the six major state-owned banks that in the first half of this year, the amount and ratio of non-performing personal loans of the six major banks have continued to increase, and the non-performing loan ratio for personal loans at the Postal Savings Bank of China has exceeded 1%. According to the mid-year report data, the six major state-owned banks added approximately 60.7 billion yuan of non-performing loans for individuals in the first half of the year. At the same time, the total amount of non-performing individual loans of the six major banks has also exceeded 300 billion yuan for the first time in the first half of the year.

Rise in non-performing individual loans for the six major state-owned banks in the first half of the year

According to the semi-annual reports of major listed banks, Financial Association reporters have conducted a statistical analysis on the situation of non-performing individual loans for the six major banks. It was found that the balance of non-performing individual loans in these six major banks has significantly increased, and the non-performing loan ratio for personal loans has also risen noticeably. The non-performing loan ratio at the Postal Savings Bank of China has already reached 1.14%, while the ratios at the other banks are all below 1%.

Specifically, the mid-year report of the Industrial and Commercial Bank of China showed that the non-performing individual loans as of the end of June amounted to 79.419 billion yuan, an increase of 18.662 billion yuan, with a non-performing loan ratio of 0.90%, up by 0.20 percentage points. In comparison, the non-performing individual loans were 60.757 billion yuan with a non-performing loan ratio of 0.70% at the beginning of 2024.

The mid-year report of the Agricultural Bank of China indicated that the non-performing individual loans as of the end of June amounted to 68.292 billion yuan, with a non-performing loan ratio of 0.79%, compared to 59.176 billion yuan and a non-performing loan ratio of 0.73% at the beginning of the year.

The mid-year report of the Bank of China showed that the non-performing individual loans as of the end of June amounted to 52.298 billion yuan, with a non-performing loan ratio of 0.88%, compared to 44.346 billion yuan and a non-performing loan ratio of 0.76% at the beginning of the year.

According to the China Construction Bank's interim report, as of the end of June, personal non-performing loans amounted to 73.714 billion yuan, with a personal non-performing loan ratio of 0.84%. At the beginning of the year, this data was 57.094 billion yuan, with a personal loan non-performing rate of 0.66%.

According to the Bank of Communications' interim report, as of the end of June, personal non-performing loans amounted to 25.157 billion yuan, with a non-performing rate of 0.98%. At the beginning of the year, this data was 20.123 billion yuan, with a non-performing rate of 0.81%.

According to the Postal Savings Bank of China's interim report, as of the end of June, personal non-performing loans amounted to 53.211 billion yuan, with a non-performing rate of 1.14%. At the beginning of the year, this data was 49.875 billion yuan, with a non-performing rate of 1.12%.

Based on the above data, statistics from the Caixin News Agency show that in the first half of this year, the total amount of personal non-performing loans of the six state-owned banks has reached 352.091 billion yuan, surpassing the 300 billion yuan mark for the first time. Compared with the data at the beginning of 2024 (291.371 billion yuan), it is estimated that the six state-owned banks added approximately 60.7 billion yuan of personal non-performing loans in the first half of the year.

Some banks have expressed their intention to control risks, while other banks have stated their intention to promote consumer credit growth.

In the face of the rising personal non-performing loan ratio, some banks have stated that they will strengthen investigations in personal credit to prevent risks, while other banks have stated that they will accelerate the development of personal consumer loans.

In its interim report, the Industrial and Commercial Bank of China (ICBC) stated that in the area of personal credit business, it will strictly assess customer qualifications, enhance the investigation of loan authenticity, prevent the risk of multiple debts, and continuously improve the operational quality of personal loan business. It will also solidify the foundation of post-loan management systems, build the "two major basic supports" + "four major sector functions" of digital post-loan, optimize the risk monitoring mechanism of personal loans, promote online and offline integrated collection work, and effectively enhance risk prevention and control capabilities.

In its interim report, the Agricultural Bank of China (ABC) stated that the bank is committed to serving people's livelihood in personal loans, increasing credit supply, including personal housing loans and personal consumer loans, etc. At the same time, the bank pays attention to protecting consumer rights, standardizing overdue collection work, ensuring personal information protection, and providing financial education services.

Bank of China stated in the interim report that in the personal finance sector, it is responding to regulatory requirements and the business development needs under the new situation, and supporting the steady development of personal credit business. It is increasing efforts to resolve non-performing assets, and preventing and resolving financial risks. It is finely managing non-performing projects, implementing classified strategies, focusing on breakthroughs, and improving disposal effectiveness.

China Construction Bank Corporation stated in the interim report that in the area of personal consumer loans, it actively responds to the national strategy of expanding consumer markets, supports the diverse consumer financing needs of residents, and continuously promotes the high-quality development of personal consumer loans. It optimizes the online and offline product service system, enhances digital operation capabilities, improves the fine operating strategies for customers and channels, maintains overall asset quality stability, expands the scope and level of serving customers, and promotes stable growth in personal consumer loans.

Institutions claim that reducing the stock of housing loans may not effectively drive effective demand for residents.

An analyst from a certain brokerage firm told a Caixin reporter that the bank's loan NPL ratio has a certain lag effect, because the essence of the bank's loan business is "profit first, risk later." The increase in the bank's individual NPLs in the first half of the year should be viewed rationally. At the same time, objectively speaking, if the reduction of residents' stock housing loans is eventually implemented, it can effectively reduce the burden of residents' monthly mortgage payments, alleviate their financial pressure, and have a certain positive effect on the NPL ratio for individual loans. But in the current overall environment, one should not overly rely on the reduction of residents' stock housing loans to have a greater impact on consumption.

On September 6th, Sun Binbin's team from TF Securities released a report stating that given the latest housing loan policies and interest rate changes this year, there is indeed a possibility of another reduction in the interest rates of existing housing loans. From the perspective of market expectations, although the reduction of existing housing loan interest rates does benefit the people, the average amount per household is relatively limited. It's difficult to stimulate effective demand in the resident sector just because of the reduction in existing housing loan interest rates. Furthermore, the reduction of the existing stock does not necessarily mean an increase in new loans, and is expected to have limited impact on the increase in real estate demand.