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*: Beijing Business Daily.
Here's the good news!National Social Security** (hereinafter referred to as "Social Security**") welcomes heavy news. On December 6, the Ministry of Finance and the Ministry of Human Resources and Social Security jointly issued the Measures for the Administration of Domestic Investment in the National Social Security ** (Draft for Comments) (hereinafter referred to as the "Administrative Measures") to adjust and optimize the investment scope, management fee rate and investment supervision ratio of social security**. Judging from the revised content, the "Administrative Measures" not only further optimize and adjust the scope of investment, but also appropriately reduce the upper limit of management fee rate and custody fee rate in combination with the direction of relevant regulatory reforms, and at the same time clarify the maximum investment proportion of ** and equity assets. In the eyes of industry insiders, this also means that the policy support for the capital market has increased, which will help promote economic development.
The scope of investment has been expanded
On December 6, the Ministry of Finance and the Ministry of Human Resources and Social Security jointly issued the Administrative Measures to solicit opinions from the public, starting from December 5, 2023 to January 5, 2024. It is reported that the "Administrative Measures" are mainly aimed at the domestic investment of the national social security, and the management of overseas investment will be improved by revising the "Interim Provisions on Overseas". The revised Administrative Measures mainly focus on the adjustment and optimization of the investment scope, management fee rate and investment supervision ratio.
Among them, in terms of the scope of investment, the previous special approval will be integrated, and the investment scope will be appropriately optimized and adjusted, taking into account the needs of safety and value preservation and appreciation. There are a total of 11 categories of products and tools in the "Management Measures", and the main adjustments include three aspects. First, it is included in the special approval content of previous years, including interbank certificates of deposit, policy and development bank bonds, local bonds, corporate bonds, bond repurchases, direct equity investment, industry, market-oriented equity investment, preferred shares, asset-based products, and publicly offered infrastructure investment.
The second is to increase and adjust the scope of national social security investment in combination with the development and changes of the financial market, with reference to the investment in basic pension insurance and enterprise annuity, including corporate bonds, debt financing instruments of non-financial enterprises, pension products, etc.
Third, according to the development of the financial market, we should appropriately increase hedging tools, including stock indexes, treasury bonds, stock index options, etc.
In addition, the "Administrative Measures" make it clear that the scope of direct investment by the Social Security Association is limited to bank deposits, interbank certificates of deposit, qualified direct equity investment, industry**, equity investment** (including venture capital**) preferred shares, approved **index investment, and exchange-traded open-ended index**.
Compared with the Interim Measures for the Administration of National Social Security Investment (hereinafter referred to as the "Interim Measures") issued in December 2001, the scope of social security investment is limited to bank deposits, buying bonds and other financial instruments with good liquidity, including listed and circulated investments, corporate bonds with a credit rating of above investment level, financial bonds and other valuable funds. It is not difficult to see that this revision further refines the investment scope of social security**.
In the view of financial commentator Guo Shiliang, the optimization and adjustment of the investment scope of social security will help improve the asset appreciation ability of social security and promote the utilization rate of social security.
Bai Wenxi, chief economist of IPG (China), also mentioned that the further optimization and adjustment of the investment scope of social security will help increase investment returns, and at the same time, it can also diversify investment risks and improve the robustness of social security.
Lower the upper limit of management and custody fees
In order to further promote the preservation and appreciation of the national social security investment, the "Management Measures" consider referring to the basic pension insurance investment supervision measures and practices, combined with the direction of relevant regulatory reforms, and moderately reduce the upper limit of management fees and custody rates.
Among them, the annual rate of ** product management is not higher than 08%, and the annual rate of bond product management is not higher than 03%；The annual rate for the management of monetary cash products shall not be higher than 0.1%；The annual rate of equity investment** management is not higher than 15%；The annual escrow rate extracted by the custodian is not higher than 005%。
The previously released "Interim Measures" pointed out that the annual rate of the entrusted asset management fee withdrawn by the social security ** investment manager is not higher than 15%；The annual rate of custody fee withdrawn by the social security ** custodian shall not be higher than 025%。It can be seen that the "Administrative Measures" have made appropriate adjustments to the management fee rate and custody fee rate for specific categories of investment products.
In this regard, Bai Wenxi believes that on the one hand, the reduction of social security fees may be for the consideration of reducing investment costs and improving returns, and on the other hand, it is also an inevitable move to adapt to the changes in the industry environment under the declining trend of bank deposit and loan interest rates. This is conducive to increasing the investment income of social security**, and at the same time, it can also reduce the burden of contributors and improve the sustainability and stability of social security**.
In addition, according to the best investment and regulatory practice, taking into account the characteristics of risk and return, the "Administrative Measures" will divide the national social security investment varieties according to deposit and interest rate, credit fixed income, ** and equity, and include the full caliber of domestic and overseas investment into the regulatory ratio. At present, the maximum investment ratio of ** and equity assets can reach 40% and 30% respectively, which further improves the flexibility of national social security investment and is conducive to continuing to support the development of the capital market.
Recall that the "Interim Measures" pointed out that the investment in monetary assets classified into social security**, calculated at cost, should be in line with the proportion of bank deposits and treasury bond investment shall not be less than 50%. Among them, the proportion of bank deposits shall not be less than 10%. Deposits in a bank must not be higher than 50% of the total amount of social security** bank deposits;The proportion of investment in enterprise bonds and financial bonds shall not be higher than 10%;*Investment**, the proportion of investment shall not be higher than 40%.
Guo Shiliang said that the maximum investment ratio of social security investment and equity assets is further refined and clarified, which is conducive to promoting the entry of social security into the market and promoting the investment enthusiasm of institutional investors.
The clarification of the proportion of social security investment and equity assets will help increase investment income and improve the asset quality and soundness of social security. In addition, this also means that policy support for the capital market will increase, which will help promote economic development. Bai Wenxi said.
Beijing Business Daily reporter Li Haiyuan.