At present, China's economic development has entered a new normal, which shows that the growth rate has changed from high speed to medium speed, the development mode has changed from extensive growth of scale speed to intensive growth of quality and efficiency, the economic structure has changed from incremental capacity expansion to deep adjustment with the coexistence of "adjusting stocks and increasing quality", and the driving force of economic development has changed from traditional growth point to new growth point. Similarly, the insurance asset management industry is also facing the challenge of the "new normal" environment.
(1) "Negative interest rate" will bring the financial market into the era of low return on capital.
With the continuous improvement of economic marketization reform, the process of interest rate marketization in China has accelerated. From 20 14, a new round of interest rate reduction cycle began. By the end of 20 15 and 10, the central bank had cut interest rates six times, and the annual deposit benchmark interest rate was adjusted to 1.5%, which was the lowest level since the founding of New China. This means that after deducting inflation, the deposit interest income is rarely or even actually negative, and China will inevitably enter a period when the real interest rate is extremely low or even negative.
It should be recognized that this is not only an independent phenomenon in China market, but also a trend with a global background. The US federal benchmark lending rate dropped sharply from 13% in 1980 to 0. 13% in September of 20 15, which was close to zero interest rate. The deposit interest rate in the United States is also declining. The average deposit cost rate of the Federal Deposit Insurance Corporation (FDIC) in the United States has dropped from 1 1% to a historical low of 0.3% in 20 14 years. The European Central Bank announced the implementation of negative interest rates on June 5, 20 14, and the Bank of Japan began to implement negative interest rates on October 29, 20 16. Not to mention whether the unprecedented "negative interest rate" medicine can achieve the effect of fighting deflation, stimulating investment and boosting consumption. Together with the continuous excessive money issuance since 2008, it has brought the global financial market into an era of low return on capital.
From a macro point of view, when central banks around the world compete to release water to cope with the economic downturn, it will lead to the phenomenon of "the demand for social financing is sluggish, but the supply of funds is strong", so the interest rate representing the financing cost will naturally fall, especially when a large amount of funds "avoid the reality" and flood into financial assets, which will further aggravate the degree of interest rate decline. Microscopically, the economic downturn means that the profits of enterprises decline, the return on physical investment declines, which means that the financing costs that enterprises can bear decline, and the return on capital providers will also decline. Taking the yield of national debt as an example, the yield of American 10 national debt dropped from 12% in the early 1980s to 2. 1% in the early 20 15 years. Similar to the United States, the yield of China's 10 national debt remained below 3%, once below 2.8% (see Figure 66).
Figure 1 USA 10 Treasury bond yield (unit:%)
In the context of slowing economic growth and deflation, in order to reduce the financing cost of enterprises, the relatively loose monetary environment will be maintained for a long time, and even if interest rates rebound at a low level, it is difficult to form a trend reversal. In other words, we will have to look for investment opportunities in financial markets in a low interest rate environment for a long time.
As an interest rate sensitive industry, the insurance industry, especially the life insurance industry, will face further interest rate risks. The profit of an insurance company mainly comes from the difference between the investment return rate and the debt cost rate, and each interest rate change mainly affects the insurance company's premium income and capital investment, and then affects the insurance company's investment return rate and debt cost rate. There are two main challenges to insurance companies under the low interest rate environment: First, under the low interest rate environment, the market interest rate and return on assets decline, while the guaranteed interest rate of the policy is rigid and difficult to adjust. When the market interest rate is lower than the guaranteed interest rate, the interest rate is upside down and the spread loss is serious; Second, at present, the duration of assets and liabilities of insurance companies in China is not completely matched. Generally speaking, the maturity of assets is shorter than that of liabilities. In the interest rate reduction cycle, the reallocation of expired assets will continuously lower the spread income, and even lead to negative spread income.
(2) The "asset shortage" puts forward higher requirements for the diversified asset allocation ability of insurance funds.
"Asset shortage" is one of the most talked-about terms in the market in recent two years, which refers to the situation that a large amount of funds can not find suitable investment products in the domestic financial system, and the allocation ideas are chaotic and the allocation results are diversified. We believe that "asset shortage" is essentially the lack of high-yield and low-risk assets.
From the cause of formation, the "asset shortage" is inseparable from the "new normal" of macroeconomics and the marketization of interest rates. First, in the process of the transition from high-speed growth to medium-high-speed growth, the downward return rate of the real economy is the root cause of the "asset shortage". With the structural transformation of the real economy, the return on investment has declined, and the rigid redemption has been gradually broken, which has brought about an increase in credit risk. The demand of large institutions for low-risk and high-yield fixed-income assets has not been met. In the investment strategy, we should either appropriately reduce the income expectation or appropriately increase the risk taking. Second, financial stability policies and targeted support policies have increased the externalities of monetary growth, and the transmission mechanism of monetary policy to the real economy has encountered bottlenecks. A large amount of monetary easing did not lead funds to real investment, but precipitated in the financial market to seek investment opportunities. M2 can no longer represent the recovery of capital demand in the real economy. According to past experience, the rebound in the growth rate of monetary aggregate is often accompanied by the rebound in total demand, but at present, this is not the case. This means that the current monetary aggregate growth is brought by the supply side (financial stability), not the demand side (physical investment, credit demand). Third, as mentioned above, with the continuous downward movement of the interest rate center and the advancement of interest rate marketization reform, the financial market has gradually deleveraging and returned to rationality after experiencing the impulse of crazy expansion of high-yield assets (non-standard trusts, bank wealth management, stock price rise, etc.). ) in previous years. It is no longer an advantage for insurance companies to have a large amount of investable funds, but the pressure is increasing. The core contradiction of the market has gradually become the contradiction that the expected return on investment is still high, but the assets with high returns have been greatly reduced.
Before talking about how to solve the "asset shortage", we must look at this market objectively from the perspective of investment. Before the economic transformation is successful, the development dividend and policy dividend assets with high return, low risk or implicit guarantee will be scarce for a long time, and the investment drive will begin to give way to consumption and innovation. Lack of leveraged investors will lead to shrinking financing demand, which is normal. Our income expectation must be reasonably lowered and adjusted in the overall asset allocation.
Investment banking thinking is very important for the use of insurance funds under the background of "asset shortage", and the power of diversified asset allocation will be greatly strengthened. Faced with the increasing pressure of assets and liabilities, insurance funds can only actively use the diversified allocation strategy of investment banks to actively seek investment opportunities, and the simple and rude passive investment model will fail, which will really test the ability of research judgment and product design. The future investment direction of insurance funds is bound to expand substantially, including but not limited to non-standard assets, real estate, overseas assets, mezzanine funds, debt plans, industrial equity investment and many other aspects. This change is conducive to improving the efficiency of asset allocation, but it also puts forward higher requirements for the investment and research ability, product design ability and risk management ability of insurance asset management institutions.
(C) "Mismatch of assets and liabilities" challenges the ability of asset allocation and portfolio construction of insurance funds.
At present, it is a prominent problem that the income and structure of insurance funds can not effectively support liabilities. The risk of mismatch between insurance assets and liabilities is mainly due to the fact that there are not many assets in the capital market that match insurance and can be invested for a long time, so many insurance institutions are forced to choose "long money and short use". On the one hand, this may lead to the inversion of cost and benefit, on the other hand, it may also lead to the maturity mismatch and bring liquidity risk. The development of China's financial market is short, and the types and quantities of long-term financial products are few, which can not fully meet the needs of insurance funds, and is also closely related to the limited investment scope of insurance funds. The recent trend of policy supervision is obviously to rapidly expand the scope of insurance funds and help insurance funds find assets matching liabilities for allocation.
The challenge of China's insurance asset allocation is not only the above-mentioned long-term mismatch, but also the current slowdown in economic growth and economic restructuring pose a challenge to the matching of insurance assets and liabilities. The decline of predictability and the rise of credit risk increase the difficulty of asset allocation. Judging from the economic development stage in which China is located, the high probability of future capital return is declining, so it is not easy to continuously reach the absolute return target and cover the debt cost in the next 10 and 15 years. The basic principle of insurance investment or the premise of all allocation strategies is absolute return, which should provide debtors with long-term competitive rate of return. How to match the risk and return and how much risk we are willing to take to obtain the target return, which is commonly known as risk-adjusted return, has become the core element and decision-making premise of insurance asset allocation. Therefore, in the decision-making process of insurance asset allocation strategy, the balance between expected target and risk preference becomes an important link. According to their own experience and research results, decision makers have to strive to grasp the balance between risk and income, so as to build a stable combination that meets the requirements of debtors and build a stable income expectation and cash flow expectation. All asset allocation behaviors will revolve around this principle.
Therefore, the discussion on the use of insurance funds must be placed under specific constraints, which are determined by the characteristics of insurance funds, such as debt cost, duration, liquidity requirements, yield expectations and regulatory rules. If assets can't effectively match liabilities, then investment risks and returns will be worrying. The risk-return characteristics of major assets are unstable in the short term and relatively stable and regular in the medium and long term. The core competitiveness of the insurance asset management team is precisely reflected in how to build a stable combination of various assets with relatively matched assets and liabilities, taking into account absolute returns and liquidity.
2. The role of investment banking thinking in different insurance asset management business areas.
The essence of investment banking thinking is to think from the perspective of resource allocation, and actively guide the flow of resources through top-down research and product or scheme design. As far as the use of insurance funds is concerned, it is to find the most efficient region, industry, enterprise or project through in-depth research, choose the best transaction structure, financial instruments and products, and urge resources (funds) to invest in these directions in the most efficient way (profit rate). Capital is essentially interest-driven and will flow around the rate of capital appreciation, thus objectively forming the effect of continuous optimization of resource allocation. Investment banking thinking will bring us: 1. Look for value depressions and investment opportunities more actively, instead of passively configuring existing financial products as buyers; 2. Look for solutions and operation methods more actively, instead of passively comparing the existing standardized products. 3. Go deeper into enterprises and projects more actively, looking for possible strategic cooperation opportunities, instead of passively investing as financial investors.
(A) investment banking thinking to guide the expansion of the field of fixed income investment
Judging from the long-term experience in the use of insurance funds abroad, the most critical thing in insurance investment is the fixed income investment strategy. Generally speaking, the fixed income investment of insurance assets will follow a clear asset-liability management framework and credit guidelines. They encourage duration matching and yield matching, mainly based on buy-and-hold strategy, and do not actively trade frequently. The adjustment of bond portfolio allocation is generally through the distribution of new cash flow, rather than the movement of existing assets.
By the end of 20 15, bank deposits accounted for 2 1.78% and bonds accounted for 34.39% in the use of insurance funds. The two traditional fixed-income assets, mainly held to maturity, still account for half of the investment in insurance funds. However, as mentioned above, in the low interest rate environment, the contribution of these two types of assets to insurance funds is gradually decreasing, or even negative. The new situation forces the fixed income investment of insurance funds to expand horizontally under the guidance of investment bank thinking, and the investment direction expands from traditional deposits and bonds to non-standard assets, asset securitization products, bank wealth management, structured financing priority products and so on.
In the field of fixed income investment, the thinking of investment banks is reflected in changing passive investment into active investment, transitioning from pure buyer mode to investment bank mode, actively expanding investment scope, exploring potential financing needs, and intervening in a series of processes such as product design and distribution. Investment in non-standard assets is the best embodiment. In addition to cooperating with peer financial institutions to invest in mature project products, we also actively explore potential financing needs to seek investment opportunities, give full play to our professional advantages on the basis of mastering first-hand project resources, and invite relevant institutions to participate in cooperative development.
Facing the situation of low interest rate under frequent risk events, we should gradually reverse the investment idea of high-yield orientation in previous years in fixed-income innovation investment. Starting from the risk, through top-down industry judgment, avoid high-risk cyclical industries, look for industries and enterprises with stable income and cash flow, especially seek cooperation opportunities with some super-large central enterprises or local state-owned enterprises with strong credit strength. Under the premise of security, through the design of transaction structure, we should try our best to meet the income requirements and the individual needs of counterparties at the same time.
Our fixed income team actively turned to investment banking thinking. According to the operation mode of investment banking projects, the Guangzhou fund project designed and finally invested by 20 15 is the priority share of Guangzhou Xinhua Chengkai industrial investment enterprise subscribed by the company through trust, and the inferior share of the partnership enterprise is subscribed by the industrial investment fund company, and the bank provides guarantee obligations for Chengtou to fulfill the repurchase when the repurchase is triggered. The project has a long term and the expected rate of return is considerable. . Guangzhou Xinhua urban development industrial investment enterprises mainly invest in medium and long-term investment projects in the field of Guangzhou urban development strategy. This product fully embodies the investment banking thinking of Xinhua investment business, and gives priority to superior resources for project integration on the basis of proactive attack, which not only meets the arrangement of higher income, but also realizes the safety of funds.
Investment banking thinking is not simply the pursuit of high returns. In the process of selecting non-standard assets, we must clearly see the systematic risks and non-systematic risks. In addition to its own internal rating mechanism, external rating is also an important reference and compliance basis. It is necessary to carefully analyze the structure, basic assets, risk-return characteristics of each non-standard investment and the matching degree with the company's liabilities, so as to break the information asymmetry as much as possible.
(b) Investment in stock assets under the investment banking model.
From the historical experience, the investment of insurance funds in equity assets, especially in the secondary stock market, often plays a decisive role in the overall return on investment, while from the stock market, high volatility and uncertainty are still the main characteristics of such assets. 20 15, the secondary stock market experienced two days of ice and fire. Earned a lot in the first half of the year, and then quickly reversed. Three stock market crashes have caused many investors to suffer heavy losses, and insurance funds are no exception.
At present, due to the imperfect governance of listed companies and the lack of dividend mechanism, the stock market still shows strong speculation and game. In a market where insurance funds, Public Offering of Fund, securities companies, private equity funds, foreign capital and a large number of individual investors play together, due to the limitation of the nature and scale of funds, insurance funds do not have advantages.
Using the thinking mode of investment bank, avoiding the pure secondary market game, taking advantage of the scale advantage and long-term advantage of insurance funds, establishing the bottom line thinking and value investment thinking on the basis of in-depth and meticulous research, and carrying out in-depth cooperation with listed companies can not only avoid the impact brought by short-term fluctuations, but also share the fruits of its long-term development and obtain long-term absolute benefits.
Institutional investors go deep into listed companies through deep cooperation in equity, and carry out resource integration and deep cooperation from strategic planning, financial consultancy, financing services, production and operation, channel marketing and customer management. Theoretically, they can win-win, and we can cite many cases, but is it true in the statistical test of large samples? We try to make an empirical test through the observation angle of three-year private placement.
Listed companies in A-share market tend to introduce strategic investors in the form of three-year private placement. These strategic investors can be the upstream and downstream of the company's industrial chain, with strong industry-related background, or they can be strong long-term strategic financial investors such as insurance funds. We count the excess returns of all these strategic investors who participated in the three-year private placement of listed companies. If the excess return is significantly greater than zero, it can be said that investors can get the excess return from their strategic investment in listed companies relative to their investment in the secondary market. Therefore, we have designed the following inspection scheme:
Sample selection-select three-year stocks issued by listed companies from June 65438+1 October1date to May 6, 201March, 2005. Since 2005, the main reason is that there were few three-year private placements before. The reason why the stocks before May 6th, 20 13 are selected is that these stocks can be listed and circulated today (May 6th, 20 16) after three years of lock-in. Data sequence calculation-calculate the rise and fall of sample stocks in the three-year lock-up period, that is, the time interval from the listing date of additional shares to the lifting date of additional shares, and record it as sequence X 1, and calculate the rise and fall of the Shanghai and Shenzhen 300 Index during this time interval, and record it as sequence x2; The test hypothesis -X 1 is significantly greater than x2; Test method-T test: paired two-sample mean analysis.
The test results are shown in figure 1:
Graph 1 t test: paired two-sample analysis of means
The test results show that the yield of three-year additional shares in the three-year lock-up period is significantly higher than that of the Shanghai and Shenzhen 300 Index in the same period, that is, it has excess yield. Therefore, it can be said that insurance funds can obtain long-term excess returns in the statistical sense by using investment banking thinking and deep cooperation with listed companies. This is also in line with the policy orientation of the state to encourage insurance funds to participate in the development of the real economy for a long time.
Xinhua has always insisted on trying to make equity investment with investment banking thinking, and achieved very good results. 2065438+In March 2004, a listed company in the field of new energy issued additional shares. We have conducted in-depth research and investigation on the development prospect and industrial evolution path of new energy vehicles, and judged that listed companies are at the top of the industrial chain and should have more room for growth. On the basis of detailed field research and due diligence, the company decided to participate in the issuance and finally succeeded. After our company became a shareholder in a listed company, we kept close communication with it, actively helped the company to make strategic plans, find domestic and foreign customers, and provide industry-related information. Although the listed company has only increased its holdings for one year, we have held them for a long time out of confidence in the company's development, and the investment income exceeds 500%.
(3) Insurance funds directly carry out investment banking business.
According to the latest "Decision on Revision (Draft for Comment)", insurance funds are explicitly allowed to invest in asset securitization products; Allow insurance funds to invest in private equity funds such as venture capital funds; Insurance funds are allowed to invest in the establishment of professional insurance asset management institutions such as real estate, infrastructure and pension, and professional insurance asset management institutions can set up private equity funds such as mezzanine funds, merger and acquisition funds and real estate funds. The further relaxation of the channels and scope for insurance funds to carry out investment banking business is conducive to improving the professional level of insurance asset management and promoting the development of third-party business of asset management companies.
The investment banking business of insurance asset management companies started late and the investment scope was narrow. Compared with traditional investment banks such as brokers, banks and trusts, the development of fund subsidiaries is slow. As a rising star, insurance asset management companies are far from comparable in development speed and asset management scale. How to develop the investment banking business of insurance asset management companies is an important issue worthy of serious consideration at the moment when interest rates are falling and assets are increasingly scarce.
We believe that in order to make a qualitative breakthrough in the investment banking business of insurance asset management companies, we must start with the change of thinking. Traditionally, we are used to appearing as investors, with a typical buyer's thinking, waiting for sellers to recommend products, and passively accepting investment results after picking and choosing. This way of thinking is bound to be reflected when starting to do investment banking business. However, with the increasingly fierce competition in the asset management industry, insurance asset management companies must change from sitting in a village to engaging in business, from passively selecting products to accepting investment results, to actively developing projects and participating in investment process management, and from simple downstream funds to upstream assets. In this process, as a relevant department engaged in investment banking business, Depth Charge also changed his thinking. Starting from providing efficient and high-quality services for financiers, we actively integrate internal and external resources, design a comprehensive and detailed financing plan for the project, and provide customers with all-round financial services.
First of all, we should proceed from the needs of financiers, take products as the core, and design projects from the aspects of investment form, term, liquidity and risk management on the basis of macro, industry and enterprise analysis to meet the needs of different investors, instead of blindly pursuing risk minimization or income maximization. For example, M&A business in emerging industries has high investment risk, while most M&A subjects are weak. Even if the credit is increased, the effectiveness is not strong, which is more suitable for pure equity investment. At this time, it is necessary to consider increasing the control of valuation and M&A terms, carrying out structural design to ensure the safety of priority funds, and deeply participating in post-investment management, rather than simply making "clear shares and real debts" products to obtain formal protection.
Secondly, the investment banking department should be good at integrating the company's internal resources, giving full play to its synergy and overall advantages, mainly in two aspects: 1. The investment department of the company is a typical representative of institutional investors in the market. Their requirements for investment income and risk management and their mastery of product details can become the first-hand information source for the investment banking department to design products. The investment banking department can learn more about the internal customer needs of the company and look for assets in a targeted manner, which is an outstanding advantage compared with other peers who blindly look for projects; 2. We can analyze the macro and the company with the help of the research ability of the company's investment research team, and look forward to the investment opportunities in the market. We can use the project resources invested by the company to further tap the needs of partners and find potential business opportunities.
Finally, the investment banking department should focus on partners, use professional knowledge, make more innovations in meeting customers' needs, deeply tap the potential and provide all-round financial services. For example, after developing clients' IPO business, traditional investment banks of securities firms will be more proactive in understanding clients' follow-up needs, and expand their private placement, mergers and acquisitions, bond issuance, project financing and other businesses to become their long-term partners. The investment banking department of an insurance asset management company should do the same.
summary
The era of big asset management under the "new normal" has arrived. Although insurance asset management companies have the advantages of large asset management scale, wide investment scope and stable investment style, they also have problems such as single business structure, single source of funds, insufficient independence, conservative and backward management mechanism, low degree of marketization, and backward personnel assessment and incentive mechanism. How to develop strengths and avoid weaknesses and find a breakthrough in the whole market competition is a problem that we must seriously consider.
Ideas determine the way out, and ideas determine the direction. No matter the theoretical discussion or the analysis of the actual situation, it finally shows that the transformation of the insurance asset management industry is imminent, and the most important thing is the ideological transformation. The thinking mode of investment bank can help us reorganize the status quo, change the perspective of business development and reposition the development goals; The thinking mode of investment bank can also help us to improve and expand the existing business modules, make up for shortcomings and give full play to advantages in order to obtain better return on investment; The thinking mode of investment banks can change the current management culture and mechanism of insurance, improve work efficiency and incentive effect, and help us expand new business areas and sources of funds.