China Net Finance, September 16 (Reporter Wang Jinrui) Since September 15, 6 large state-owned banks and 10 banks including China Merchants Bank, China Everbright Bank, China CITIC Bank, and Minsheng Bank have announced that they will adjust the listed interest rate of RMB deposits. The scope covers demand deposits, call deposits, lump-sum deposits and withdrawals, and fractional deposits and lump-sum withdrawals, and the reduction range is 10-30 basis points.
Industry experts said that since the beginning of this year, the net interest margin of commercial banks has continued to narrow, and it is imperative to control the cost of bank liabilities. Under the current environment, banks have lowered deposit interest rates through market-oriented mechanisms, reducing the cost of bank deposits and liabilities to a certain extent, and expanding space for banks to further rationally benefit the real economy.
A number of banks announced to cut the listed deposit interest rate
On September 16, China Everbright Bank, China CITIC Bank, and Minsheng Bank announced that they will adjust the listed interest rate of RMB deposits from September 16, 2022. Previously, on September 15, Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, Bank of Communications, Postal Savings Bank of China, and China Merchants Bank all announced to adjust the listed interest rate of RMB deposits. The scope covers demand deposits, call deposits, lump-sum deposits and withdrawals, and fractional deposits and lump-sum withdrawals, and the reduction range is 10-30 basis points.
A reporter from China.com.cn checked the above-mentioned bank announcements and noticed that the demand deposit rates of the above-mentioned 10 banks were all lowered by 5 basis points to 0.25%. As far as the lump-sum deposit and withdrawal time deposits are concerned, after the adjustment, the interest rates of the 6 large state-owned banks and China Merchants Bank’s 3-year fixed deposit (bulk deposit and withdrawal) have been adjusted to 2.60%, which is 15 basis points lower than before. The interest rates of 3-month, 6-month, 1-year, 2-year, and 5-year time deposits (bulk deposit and withdrawal) for 6 banks including Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, Bank of Communications and China Merchants Bank will be adjusted respectively. were 1.25%, 1.45%, 1.65%, 2.15%, and 2.65%, all down 10 basis points from the previous period. In addition, the interest rates of the 6-month and 1-year time deposits (in a single deposit and withdrawal) of the Postal Savings Bank of China were both reduced by 10 basis points compared with the previous ones, adjusted to 1.46% and 1.68% respectively.
In addition, after the adjustment of interest rates for lump-sum fixed deposits of China Everbright Bank, China CITIC Bank and Minsheng Bank, 3-month, 6-month, 1-year, 3-year and 5-year fixed deposits (bulk deposit and lump-sum withdrawal) The interest rates were adjusted to 1.30%, 1.55%, 1.85%, 2.65%, and 2.70% respectively. In terms of the 2-year time deposit (in a lump sum deposit and withdrawal) interest rate, China Everbright Bank lowered it to 2.30%, China CITIC Bank lowered it to 2.20%, and the people’s livelihood Banks downgraded to 2.25%.
In fact, as early as April 2022, many large state-owned banks have lowered the interest rate on personal deposits. According to the central bank’s monetary policy implementation report for the first quarter of 2022, state-owned banks such as the Postal Savings Bank of China Industrial and Commercial Bank of China and most joint-stock banks have lowered their interest rates on time deposits with a maturity of more than one year and large-denomination certificates of deposit in late April. Adjusted accordingly.
The central bank’s monetary policy implementation report for the first quarter of 2022 pointed out that in April 2022, the central bank guided the interest rate self-discipline mechanism to establish a market-oriented adjustment mechanism for deposit interest rates. The loan market interest rate represented by the 1-year LPR, and the deposit interest rate level is adjusted reasonably.
“After the establishment of the market-oriented adjustment mechanism for deposit interest rates, it can promote the mutual linkage between deposit interest rates and LPR, and make the transmission of policy interest rates to deposit interest rates more smoothly.” Wen Bin, chief economist of Minsheng Bank, analyzed that this time the deposit interest rate of major state-owned banks has been lowered. , indicating that the effect of deposit rate reform is showing.
“After the mid-term lending facility (MLF) cut interest rates by 10 basis points unexpectedly in August, the yield on 10-year government bonds fell sharply and rapidly, and the LPR with a maturity of 1 year and a maturity of more than 5 years was reduced by 5 basis points and 15 basis points respectively, and the deposit rate was lowered. And the rate of reduction is generally consistent, indicating that the reform of the deposit rate is showing results.” Wen Bin said.
Expert: Reasonably reduce the cost of comprehensive liabilities
As for why banks want to lower the listed interest rate of RMB deposits, industry experts said that under the current environment, banks reduce the deposit interest rate through a market-oriented mechanism, to a certain extent, reduce the cost of bank deposits and liabilities, and expand space for banks to further reasonably benefit the real economy.
According to data from the China Banking and Insurance Regulatory Commission, the net interest margin of commercial banks in the second quarter of 2022 was 1.94%, which continued to narrow by 3 basis points from the first quarter. “This is mainly due to the continuous decline of bank asset-side yields due to the imbalance between profit-making entities and credit supply and demand. Since the second quarter, due to the severe regularization of deposits, the decline in deposit costs has been significantly lower than that of loans. In a relatively loose liquidity environment, The ultra-low operation of the capital interest rate enables banks to continue to enjoy low-cost market debt dividends, otherwise the pressure on the narrowing of the net interest margin will be further highlighted.” Wen Bin said.
“In the current environment, banks have lowered deposit interest rates through market-oriented mechanisms, reducing the cost of bank deposit liabilities to a certain extent, and expanding space for banks to further rationally benefit the real economy; and help to promote residents to moderately reduce savings rates, increase consumption, and accelerate domestic demand. Recovery.” said Zhou Maohua, a macro researcher at the Financial Market Department of China Everbright Bank.
Dong Ximiao, chief researcher of China Merchants Union Finance, said that recently, many large banks have lowered deposit rates of various terms, not only because of the banks themselves, but also due to the influence and effect of many external factors. From the perspective of internal factors, this is an active behavior of banks to strengthen asset-liability management and maintain a basically stable interest rate spread. From the perspective of external factors, it is mainly affected by three factors: first, the market liquidity is relatively abundant this year; second, the financial management department strengthens guidance; third, the willingness of residents to save continues to increase.
In addition, Dong Ximiao pointed out that after large banks cut deposit interest rates, it is expected that more banks will follow suit, but different banks have different development strategies, debt capacity, and business structures, and the extent and pace of deposit interest rate adjustments may be quite different. For the majority of residents, if there are more deposits and cash management wealth management products in asset allocation, the yield may decline. The relationship between risks and returns should be well balanced, and a diversified asset allocation should be made based on one’s own risk tolerance and investment and financial management needs.
(Editor in charge: Chang Shuai Shuai)
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