operational analysis report on shanghai housing provident fund in first half of 2015
2015 is a critical year for housing provident fund reforms and innovation. in the first half of the year, the center stepped up effort in boosting the municipality’s housing provident fund withdrawal and use measures in accordance with the requirements of the third plenary session of the eighteenth committee of the cpc, and made adjustments to policies for housing provident fund withdrawals and use to further bolster basic housing demands of the vast employees and unleash bonuses from the systems. the municipality’s housing provident fund gained a good momentum in terms of its operation in the first half of this year. service performance indexes such as contribution/payment amount, withdrawal amount, the number of actually paying entities, amount of home loans issued, and value-added proceeds have attained a relatively high level in comparison with the same period of previous years, with continuous improvement of fund use efficiency and a low level of loan risks.
the good performance of various services in the first half of the year has laid the foundation for fulfillment of the twelfth five-year plan for shanghai housing provident fund. by the end of june, service performance indexes such as housing provident fund collection amount, the number of paying employees, amount of home loans issued, and value-added proceeds have attained the objectives and targets set in the twelfth five-year plan ahead of schedule.
1. accomplishments in various service performance indexes
housing provident fund payment: housing provident fund payment in the first half of the year hit 42.692 billion yuan, up 9.00% year on year, including housing provident fund at 33.676 billion yuan, i.e. 79% of the total payment amount, and additional provident fund at 9.016 billion yuan, i.e. 21% of the total payment amount. as of the end of june, the aggregate housing provident fund payment amount reached 564.252 billion yuan, and the balance of the payment amount after deducting withdrawals was 263.392 billion yuan, up 17.06% and 15.35% over same period last year respectively.
the actually paying entities in the first half of the year recorded 224700, up 30.41% over same period lat year, with a net increase of 52400, and the actually paying employees hit 6.4299 million, up 8.71%, over same period last year, with a net increase of 514900.
housing provident fund withdrawal: housing provident fund withdrawals in the first half of the year climbed 11.10% year on year to 24.509 billion yuan, comprising 18.931 billion yuan worth of housing consumption oriented withdrawals and 5.578 billion yuan worth of non housing consumption type of withdrawals, accounting for 77.24% and 22.76% respectively. housing provident fund withdrawals as of end of june totaled 300.86 billion yuan, equivalent to 53.32% of the total payment amount.
housing provident fund loans made: altogether 38.486 billion yuan worth of home loans was lent out to 77000 households in the first half of this year, up 48.16% and 12.55% year on year respectively. home loans repayment received in the first half of the year totaled 17.081 billion yuan, up 36.87% year on year. the cumulative home loans issued as of end of june 2015 was 448.023 billion yuan, benefiting 2.0325 million families, up 15.38% and 6.84% year on year respectively. the balance of the home loans amounted to 222.605 billion yuan, with the home loans percentage edged up 2.46% over the end of the previous year to 84.51%.
the pilot project loans issued in the first half of this year recorded 354 million yuan, actually collected loan principal totaling 1.05 billion yuan. as of end of june 2015, the cumulative pilot project loans lent out hit 9.208 billion yuan, the cumulative amount of loan principal returned totaling 4.337 billion yuan, and the balance of the project loans amounting to 4.871 billion yuan.
housing provident fund loan risks: by end of june 2015, the delinquency rate on housing provident fund home loans was 0.12‰, down 0.04 per-milleage points over the end of the previous year, far and away lower than the corresponding non-performing home loan ratio of the commercial banks, indicating a relatively low risk level. no delinquency on pilot project loan existed.
housing provident fund value-added proceeds: housing provident fund service revenues in the first half of this year reached 4.731 billion yuan, and the service expenses amounted to 979 million yuan. thus housing provident fund value-added proceeds reached 3.752 billion yuan, up 64.92% year on year. the value-added proceeds percentage (the ratio of value-added proceeds to the average monthly payment balance) for the first half of this year was 1.47%, at the backdrop of the central bank’s loan and deposit interest rate cut three times during the first half of this year, with a rise of 0.44 percentage points over the same period last year.
(1) provident fund home loans issued jumped in terms of scale, indicating the new home loan policies eventually hit home.
housing provident fund home loans issued during the first half of the year totaled 38.486 billion yuan, up 48.16% year on year and 81.16% month on month. provident fund home loans issued edged up drastically, mainly ascribed to the central bank’s provident fund loan interest rate cut three times during the first half of this year, the property market’s gaining steam and the implementation of the new policies on home loans in shanghai.
adjustments were made to the municipality’s housing provident fund home loans caps and second-hand home loans’ payback periods effective as of 15 april. the new home loan policy lent itself perfectly to home loans, triggering dramatic growth of the demand for loans, namely, a 1.9-fold increase in the average daily handling volume, drastic increase of 38% in the average size of loan per family from 450,000 yuan to 620,000 yuan, extension of the average loan payback period from 18 years to 20 years, and rapid growth of the home loans issued in june equivalent to 11.384 billion yuan, thus catapulting the first half year’s home loans issued to a record new high.
structural analysis of the home loans indicates that, of the homes purchased with loans, those first-suite homes or improvement oriented homes equal to or less than 90 square meters account for 59%, and those ranging 90 – 144 (incl.) square meters 34%. among these home purchasing borrowers, the low-income employees (i.e., personal income level lower than the average employee salary in this municipality) account for 33%, and the medium income employees (i.e., personal income level tantamount to one-fold to three-fold the average employee salary in this municipality) 49%. data indicates that housing provident fund has played a positive role in providing home loans to bolster low and medium incomers’ purchasing of first homes or improvement oriented homes.
(2) rent outlay oriented withdrawal surged in wake of adjustments of pertinent withdrawal policy, mainly benefiing new migrant workers in shanghai.
rent oriented withdrawal policies were adjusted twice during october 2014-may 2015, with further expansion of withdrawal scope, easing of withdrawal criteria and improvement of withdrawal mechanism, thus better enhanced the essential housing consumption of employees’ families. consequently, rent oriented housing provident fund withdrawal jumped to 117 million yuan in the first half of the year, a 6.2-fold rise over the same period of last year.
the first half year’s rent oriented withdrawal amount curve indicates that the monthly rent oriented withdrawal amount during january-april remains relatively stable at a monthly average of 11 million yuan, and the monthly withdrawal amount in may and june climbed to 33 million yuan and 41 million yuan respectively, up 200% and 273% respectively over the average monthly withdrawal amount of the first four months of this year. such rigorous growth in may and june is attributed to the implementation of the new withdrawal policy of further easing rent oriented housing provident fund withdrawal criteria as of 1 may.
recent tabulate statistics show that since may, the new rent oriented withdrawal policy has enhanced the support to the essential housing demands of those first home buyers in this municipality, benefiting a broader swathe of low-incomers in helping alleviate their housing cost concerns. in the past two months since implementation of the new policy, rent oriented withdrawals handled totaled 12552 cases, benefiting 12648 individuals or families, with a daily average of 285 withdrawals, a five-fold rise over the january – april 2015 period prior to the implementation of the new policy. further analysis indicates that the new policy has mainly benefited the new migrant young workers in shanghai, with the non-local home purchasers accounting for 87% and youngsters age between 20 and 38 accounting for 88%.
(3) paying entities witnessed a sustained rapid growth, with newly registered paying entities featuring a growing trend toward small startups.
years of publicity measures, payment coverage expansion and law enforcement inspection initiatives and sustainable improvement of housing provident fund withdrawal and use oriented policies have increased housing provident fund payment compliance awareness and willingness of those unregistered entities, resulting in a 30.41% rise of housing provident fund paying entities in the first half of this year to reach 224,700, up 52,400 over the same period of last year. the newly registered housing provident fund paying entities hit 23,900 in the first half year, up 10,400 by 76.88% comparing with the same period of last year. the year-on-year increase of the actually paying entities and the newly registered paying entities in the first half year both hit a five-year high.
the newly registered paying entities feature a growing trend toward small startups in terms of personnel strength. those newly registered having 5 or less paying employees account for 82%, indicating a broader housing provident fund coverage of small startups.
in response to the current growing trend of housing provident fund paying entities toward small startups, the municipal provident fund center stepped up effort in implementing an array of service improvement measures, resorting to the new approach to online payment’s interbank disbursement as of 20 march this year, in wake of the debut of ccb online payment and entrusted account deduction. by the end of june, altogether 4322 paying entities have signed the online payment’s interbank disbursement agreement.
(4) security housing oriented housing provident fund project loans have entered the repayment phase, with fund collection in good progress.
the housing provident fund project loans in support of the security housing of this municipality entered the repayment phase this year. to be concrete, 11 projects entered the repayment phase among the 15 endorsed pilot security housing projects as of end of june. the cumulative amount of principals collected totaled 4.337 billion yuan,and the balance of the project loans recorded 4.871 billion yuan. the loan collection was in good progress.
so far 6 pilot project loans, including five for projects on renovation of shanty areas and one for joint-ownership security housing project, have been paid off, involving 670,000 square meters’ security housing (in building area), to the benefit of 9200 low and medium level income employee families.
3. some major tasks in the second half of this year
(1) take an active role in conducting law enforcement inspection (a trilateral initiative jointly launched by the municipal provident fund management committee, the municipal trade union and the municipal provident fund center in april of this year) as well as increasing awareness for housing provident fund payment compliance in a bid to further expand housing provident fund system coverage, particularly focusing on rural hukou employees (with rural household registration status) of certain industries in this municipality and those special groups such as those off-staff traffic co-wardens specified in the ten thousand persons’ job placement project.
(2) develop and construct the integrated housing provident fund service platform for service upgrade, incorporating the multifaceted service facilities and venues such as hotline 12329, 12329 sms application, spf wechat account (to be launched at an appropriate time), spf weibo and pf mobile app, and furnishing more atm-aided hpf self services jointly with pudong development bank, shanghai bank, shanghai rural commercial bank and shanghai branch of china bank of communications within this year as scheduled, in wake of the launch of ccb’s self service hpf atm query and its anticipated accomplishment last year.
shanghai provident fund management center
august 2015
note: adjustments have been made to certain indexes in this report for compliance with notice of mohurd, mof and pboc on improving housing provident fund information disclosure system ,issued in february of this year( jj no. 26 (2015).
