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Reporter of China Business Network: Zhen Sujing Editors of China Business Network: Lu Xiangyong, Chen Mengyu

Bank mortgage loan rebates have always been a secretive area in the financial industry.

The practice of rebates, in which banks pay a certain commission to intermediaries or developers based on the proportion of the loan amount, was once regulated, but under performance pressure, some banks have begun to adopt this method to attract customers.

Recently, acommercial BankThe manager of the loan department of the Shenzhen branch said in an interview with the reporter of the National Business Daily (hereinafter referred to as the reporter or reporter) that the rebate of bank mortgage loans is phased, and the highest is 6‰ (of the loan amount). The worse the market is, the higher the rebate is, and there is no rebate when the market is good.

However, an employee of a bank in Shanghai said that returning cash to customers is against regulations and that banks also have funding costs.

Many industry insiders said in an interview with the China Business News that such rebates are inevitable given performance appraisals, heavy pressure on loan issuance and shrinking mortgage demand, but the rebates themselves can easily lead to vicious competition.

Apply for a 1 million yuan loan and get a 5 gram gold bar as rebate

Chen Qing, a home buyer in Shanghai, said that she applied for a second-hand house mortgage in June this year and used the commercial loan rebate to cash in a 5-gram gold bar, but was told by bank staff that direct cash was not allowed.

Chen Qing told reporters that the staff would give buyers several options to choose from, including gold bars or other gifts. She did not calculate the specific rebate amount converted from her commercial loan, but only said that the bank gave her a 5-gram gold bar for a commercial loan of just over 1 million yuan. After receiving the gold bar, Chen Qing also began to enthusiastically recommend account managers to other buyers, and introduced the rebate situations for applying for bank commercial loans.

However, the reporter noticed that many home buyers mentioned that if they want to get bank mortgage loan rebates, a key step is to find the lending bank themselves.

Chen Qing frankly said that one should not go to the bank that acts as an intermediary, because the intermediary still wants to keep the money from the gold bars for himself.

Another home buyer, Yang Xiu, said that he learned that he could get a rebate for applying for a bank loan only after signing the purchase contract, so he wanted to go to the bank to apply for a loan himself, but the agency that served him did not allow it, saying that he could only use the bank they cooperated with. After many rounds of communication and negotiation, Yang Xiu got the result that he could only get the bank rebate after increasing the agency fee rate.

Yang Xiu concluded that theoretically one could find a bank to process the loan by himself and he should clarify things with the intermediary before signing the contract. However, to save trouble he asked the intermediary to arrange a few banks for him. As a result, the intermediary directly arranged the bank they cooperated with and took the kickback.

Zhang Bo, director of the 58 Anjuke Research Institute, said in an interview with reporters that rebates can essentially be regarded as a commission, that is, in order to compete for market share in the mortgage business, banks pay fees to relevant intermediary institutions that provide mortgage services. This fee itself has a certain proportional relationship with the mortgage amount.

The emergence of the mortgage rebate phenomenon essentially requires two conditions. First, the real estate market continues to be at a relatively low point, and the transaction volume in the first- and second-hand markets continues to decrease, resulting in a continuous reduction in the scale of mortgage loans. Second, loan interest rates continue to decline, and the net interest margin of the banking industry continues to decline, accompanied by increased lending pressure.

Li Yujia, chief researcher of the Housing Policy Research Center of the Guangdong Provincial Urban and Rural Planning Institute, said in an interview with reporters that such rebates are inevitable in the context of performance evaluation, high pressure on loan issuance, and shrinking mortgage demand. Some of them appear in the form of shopping cards or gifts. This is the inevitable result of the trade-offs between the rigid constraints on the cost of funding sources, as real estate transactions are no longer growing or even declining, banks are facing a shortage of loan assets, and competition is intensifying.

The worse the market is, the higher the rebate will be.

However, the reporter learned in the interview that bank staff in different places have different opinions on mortgage loan rebates.

The manager of the loan department of a commercial bank's Shenzhen branch said in an interview with reporters that the rebate for mortgage loans is phased, with the highest being 6‰ (of the loan amount). The worse the market is, the higher the rebate is, and when the market is good, there is no rebate.

According to him, taking the current Shenzhen real estate market as an example, there are mortgages for both new and second-hand buildings, but all of them are returned to the intermediary or developer. For example, in a real estate project in Qianhai, Shenzhen, the bank's mortgage service fee for real estate sales is 4‰ at most. If a home buyer applies for a mortgage loan of 5 million yuan, the bank needs to pay 20,000 yuan in cash as a mortgage service fee to the real estate sales.

An employee of a large intermediary platform in Shenzhen admitted that this was a short-term phenomenon, but when the reporter asked about the specific rebates, he said he did not know and had asked the platform, and was told that they had never received such rebates.

Another senior real estate professional told the reporter that the bank mortgage rebate has always existed, and most of them are 5‰ to 1%. It depends on the company. For example, some large chain platforms "eat up" the rebate at the company level, and the salesperson may not even know about it.

A bank employee in Dongguan mentioned in a conversation with the reporter that they can return 6‰ to 8‰, but not to the borrower. "The intermediary helps the home buyer find a bank to arrange a loan, and the bank returns the money to the intermediary, not to the borrower."

Zhang Bo said that by paying rebate commissions, the bank's operating costs will indeed increase, but it can effectively increase the total amount of mortgage loans, especially for high-quality assets such as mortgage loans, and banks are more willing to lend. For banks with greater lending pressure, this method has obvious short-term benefits.

"But rebates themselves can easily lead to vicious competition. In order to win customers, some banks irrationally increase the rebate ratio too high, which may lead to potential risks in the market. At the same time, due to the high rebate ratio, it will also affect the bank's profit margin, resulting in a continuous reduction in the net interest margin, which is not conducive to the long-term operation of the bank." Zhang Bo believes.

How should we strengthen supervision and prevent risks regarding bank rebate practices?

Li Yujia believes that there are many individual cases and they are relatively hidden, making it difficult to detect violations.

On the one hand, we should give full play to the role of the banking industry's self-regulatory mechanism and encourage everyone to operate in a transparent manner and avoid malicious competition. After the lower limit is not set, the pricing anchor is gone, and banks have engaged in vicious competition. It is recommended that the banking industry association, trade union, and self-regulatory mechanism set a minimum interest rate bottom line for loans;

On the other hand, banks should regulate their marketing expenses and not spend money on buying loans. In addition, they should transform to emerging industries supported by national strategies, such as pension, technology, green, inclusive finance, etc., and should not continue to roll back on mortgages.

(Chen Qing and Yang Xiu are pseudonyms in this article)

reporter|Zhen SujingEditor|Lu Xiangyong Chen Mengyu Gai Yuanyuan

Proofreading|Liu Siqi

｜Original article from nbdnews, Daily Economic News｜

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Daily Economic News