Report Industry Investment Rating No information provided in the content. Core Views of the Report - Since 2025, products such as wealth management, fixed-income plus, and equity have attracted significant funds. Money market funds and bond funds have seen a notable decline in net asset value growth, while fixed-income wealth management products continue to grow due to their yield advantage over time deposits. Insurance premium income growth was high before the reduction of the guaranteed interest rate but has since decreased. Equity and hybrid funds have maintained high-speed growth [1]. - Deposit relocation and stock market rallies often reinforce each other. The current deposit relocation is related to factors such as the reduction of deposit interest rates, regulatory bans on manual interest supplements, and the rise of the stock market. As the equity market continues to rise, deposit relocation accelerated in July [2]. - In the long term, non-bank institutions tend to adjust their asset allocation in a low-interest-rate environment. For example, the proportion of pure fixed-income funds has decreased in the United States, Europe, and Japan during low-interest-rate periods. In China, the proportion of bond and money market funds among all public funds has decreased since 2025 as the absolute level of interest rates has declined and the profitability of bond assets has weakened [3]. - In the short term, the relocation of non-bank funds may slow down periodically. This can be observed from the following perspectives: the relative advantage of stocks over bonds may decrease as the stock market rises; the spread between the 10-year Treasury bond yield and the policy rate has returned to the "normal" range; and an increase in the scale of 30-year ETFs and the long-short ratio of TL positions may indicate a slowdown in non-bank fund relocation [4]. Summary by Relevant Catalog I. Products such as wealth management, fixed-income plus, and equity attract significant funds 1.1 Decreased attractiveness of non-equity assets to funds - Cash management products have limited appeal. During the current deposit relocation period, money market funds have grown more than cash management wealth management products. Since 2025, the yields of both types of assets have dropped to low levels, with cash management wealth management products having an annualized yield of about 1.6% [12]. - The bond market's profitability has declined, but it still offers an advantage over time deposits. Since the end of 2023, bond funds and fixed-income wealth management products have grown rapidly. However, since 2025, the bond market has entered a "triple low" era of low interest rates, low spreads, and low volatility, leading to a decline in the profitability of pure bonds and a slowdown in the growth of bond fund scale. Currently, the annualized yield of pure bond funds is about 2.7%, and that of fixed-income plus funds is about 2.6%, still significantly higher than the time deposit rate of about 1% [12]. - The attractiveness of insurance products has diminished. After the reduction of the guaranteed interest rate in September, the "panic buying" effect has weakened. The market's response to this round of "panic buying" has been muted due to factors such as the establishment of a dynamic adjustment mechanism for the guaranteed interest rate, the exhaustion of consumers' purchasing power from previous rounds of "panic buying," and the decreasing marginal impact of interest rate adjustments on consumers' willingness to move funds in a low-interest-rate environment [17]. 1.2 More funds may flow into the equity market - Equity funds have experienced high-speed growth, and the stock market is attractive to funds. Since September 2024, as the stock market has continued to rise, the net asset value of equity funds has maintained high-speed growth, and the growth rate of hybrid funds has turned positive. The yields of equity and hybrid products have been increasing, and they are expected to attract more funds in the future [22]. - In the future, more funds may flow into the equity market. In a low-interest-rate environment, equity assets are more cost-effective than pure bonds. As the equity market rises, the overall risk appetite has increased, and residents and non-bank funds may flow more into the equity market. Since July 2025, the increase in wealth management products has been lower than in previous years, indicating that more funds have flowed into other non-bank institutions and products. The risk appetite of non-bank institutions has increased significantly, as evidenced by the growth of convertible bond ETFs and the increase in institutional new account openings in the stock market [25]. II. How long will the relocation of deposits and non-bank funds continue? 2.1 Deposit relocation and stock market rallies often reinforce each other - The current deposit relocation is related to multiple factors, including the reduction of deposit interest rates, regulatory bans on manual interest supplements, and the rise of the stock market. Since 2022, there have been multiple rounds of deposit interest rate cuts. After the first four cuts, the last three cuts had a limited impact on deposit relocation. In 2024, the ban on manual interest supplements led to a significant decrease in deposit growth and a large increase in non-bank deposit growth, but the relocation reversed after the standardization of interbank deposit interest rates in November. The rise of the stock market has also driven deposit relocation. In September 2024, non-bank deposit growth increased significantly due to the stock market rally but then declined. In July 2025, the increase in risk appetite at home and abroad led to a rise in the equity market, and institutional funds and deposits moved from pure bonds to fixed-income plus and equity products, resulting in a significant increase in non-bank deposit growth [30][35]. - Deposit relocation accelerated in July as the equity market continued to rise. After the state-owned large banks initiated a new round of deposit interest rate cuts in May, deposit relocation was not obvious in June. However, in July, the combined deposits of residents and enterprises decreased by 2.57 trillion yuan, the highest in the past four years. Resident deposit growth decreased slightly, while non-bank deposit growth rebounded significantly to 15% [36]. - Deposit relocation may continue. Historically, deposit relocation has been significant during major stock market rallies, such as from 2005 - 2007, 2014 - 2015, 2016 - 2017, 2019 - 2021, and since September 2024. Even after the stock market reaches a peak and retraces, deposit relocation usually continues for some time. Since July, the stock market has risen significantly, and if it continues to rise, deposit relocation may persist [37]. 2.2 In the long term, non-bank institutions tend to adjust their asset allocation in a low-interest-rate environment - Non-bank asset allocation adjustment is a typical feature of a low-interest-rate environment. In recent years, as broad-based interest rates have declined, the profitability of fixed-income assets such as bonds has gradually decreased. Driven by factors such as the introduction of policies to stabilize the capital market in September 2024, technological breakthroughs since 2025, and the expectation of "anti-involution" policies, the equity market has continued to break through, and non-bank institutional funds have shifted from pure fixed-income assets to equity and fixed-income plus assets [41]. - Similar trends have been observed in other countries. In the United States, during the two rounds of interest rate cuts from 2007 - 2016 and 2018 - 2021, the proportion of bond and money market mutual funds decreased from a high of 56% in 2008 to about 40% in 2021. In Europe, from 2012 - 2021, the proportion of bond and money market UCITS funds decreased from 45% in 2012 to about 36% at the end of 2021. In Japan, after entering a low-interest-rate era in the late 1990s, the scale of bond and money market funds declined rapidly, and their proportion decreased from a peak of 77% to about 7.0% in March 2024 [41][42][49]. - In China, the scale of bond and money market funds has grown rapidly in recent years, and their proportion among all public funds increased from about 55% to about 65% in 2024. However, since 2025, the proportion has decreased as the absolute level of interest rates has declined and the profitability of bond assets has weakened [49]. 2.3 In the short term, when will the relocation of non-bank funds slow down periodically? - The relocation of non-bank funds may slow down periodically as the equity market fluctuates and interest rates change. This can be observed from the following perspectives: - Stock-bond valuation and bond-credit valuation: As the stock market rises significantly, the relative advantage of stocks over bonds may decrease. As of the end of August, the risk premium of the WIND300 ex-financial index has decreased from more than two standard deviations above the mean to less than one standard deviation below the mean, and the risk premium of the dividend index has decreased to near two standard deviations below the mean. Insurance funds and other institutions may slow down the relocation of funds. Bonds still have a significant advantage over loans, and as the bond market rebounds from a low level, the cost of real economy financing continues to decline, making bonds attractive to banks [52]. - The spread between the 10-year Treasury bond yield and the policy rate: Before 2024, the spread between the 10-year Treasury bond yield and the 7-day reverse repurchase rate fluctuated around 70BP. In 2024, as broad-based interest rates declined, the spread was compressed to about 50BP. From December 2024 to January 2025, interest rates declined rapidly, further compressing the spread. Since 2025, the spread has oscillated between 10BP and 40BP. However, since late July, as the bond market has continued to rebound, the spread has gradually risen to about 45BP, returning to the "normal" range before 2025, indicating that the market has corrected the previously overdrawn expectations, and non-bank funds may slow down the selling of bonds [57]. - The scale of 30-year ETFs and the long-short ratio of TL positions: As the equity market rally slows down and interest rates rise, institutions are increasing their purchases of 30-year ETFs, and the long-short ratio of TL positions is rising. On the one hand, the growth of fixed-income plus products has increased the demand for 30-year ETFs. On the other hand, some institutions may buy 30-year ETFs and TL to hedge against equity market risks. When the scale of 30-year ETFs and the long-short ratio of TL positions continue to rise, it may indicate a slowdown in the relocation of non-bank funds [61].
流动性和机构行为系列之二：存款和非银资金搬家能持续多久？
Western Securities·2025-09-10 10:47