After a lapse of more than three months, the deposit interest rates of major state-owned banks have been "cut" again.
* Times Brokerage China reporter verified from multiple sources on December 21 that from December 22, a number of large state-owned banks will reduce the deposit interest rate again, and the interest rate of time deposits and large certificates of deposit of different maturities will be reduced by 10bp (basis point bp, 25bp and 30bp, and the deposit term covers one year to five years.
This afternoon, the ICBC APP suddenly posted the "Explanation on Adjusting the Interest Rate of RMB Savings Deposits", which lowered the listed interest rate of deposits from December 22, 2023, mainly involving 3-month, 6-month, one-year, two-year, three-year, five-year time deposits and large-amount certificates of deposit.
ICBC took the lead
On the afternoon of December 21, the ICBC APP posted the "Explanation on the Adjustment of RMB Savings Deposit Interest Rate", stating that "in order to further play the role of the market-oriented adjustment mechanism of deposit interest rates, continue to release the first-class interest rate reform and transmission effect of the loan market, and improve the sustainability of serving the real economy, our bank will lower the deposit listing interest rate from December 22, 2023".
ICBC said that the adjustment of the listed interest rate mainly involves 3-month, 6-month, one-year, two-year, three-year, five-year time deposits and large-amount certificates of deposit, of which the listed interest rate of call deposits was reduced by 02 percentage points, the listed interest rates such as lump sum deposit, lump sum deposit and zero withdrawal, and principal deposit interest will be reduced by 01 percentage point, 3-month, 6-month, one-year fixed deposit interest rates reduced by 01 percentage point, the two-year fixed deposit interest rate was lowered by 02 percentage points, three-year and five-year time deposit interest rates reduced by 025 percentage points.
In addition, ICBC also announced that the prime interest rate level for call deposits and time deposits (including large-denomination certificates of deposit) has been optimized to reflect the changes in the market interest rate situation.
Another big bank told reporters that the bank will reduce the interest rate on corporate and personal deposits from tomorrow, and the longer the term of time deposits or large certificates of deposit, the greater the decline, of which the interest rate on time deposits will be reduced by 10bp for one year and less, 20bp for two years, and 25bp for three and five yearsIn terms of large-denomination certificates of deposit, the maximum interest rate for one-year and less will be reduced by 10bp, the maximum interest rate for two-year tenors will be reduced by 25bp, and the maximum interest rate for three-year and five-year tenors will be reduced by 30bp.
It is worth noting that this is the second reduction in three months after the national commercial banks lowered the interest rate on deposits in early September this yearSince September 2022, commercial banks have taken the initiative to adjust the listed deposit interest rates for the fourth time according to their own operational needs and market situation. Compared with the cut in September this year, the reduction in the deposit rate this time is similar.
Bank spreads continue to be under pressure.
The fact that a number of national banks have lowered their deposit interest rates again is a market-oriented adjustment based on their own operating needs in the context of narrowing net interest margins. According to the "Report on the Implementation of China's Monetary Policy for the Second Quarter of 2023" (hereinafter referred to as the "Report") released by the People's Bank of China on August 17, "the asset scale and total profit of China's commercial banks have gradually expanded, but the net interest margin and return on assets are on a downward trend." Considering that the financial cycle and the economic cycle are often not completely synchronized, it takes a period of time for banks to be exposed to credit risk, so they should have certain financial resources and risk buffers. Allowing banks to maintain their own sound operations in a reasonable manner can enhance their ability to continue to support the development of the real economy. ”
According to data from the State Administration of Financial Regulation, the net interest margin of commercial banks in the first three quarters was 173%, down 001 percentage point, another record low. At the previous interim results conference of a number of listed banks, many bank executives** net interest margin in the second half of the year was still under pressure to narrow. Against this backdrop, the above statement is seen by the market as a signal that banks will cut deposit rates again. Wang Yifeng, chief financial analyst of Everbright, pointed out in the research report that the statements in the report actually reflect the policy intention of maintaining reasonable profit growth and stable net interest margin of banks, which will not only affect banks' willingness to provide credit and serve the real economy, but also affect the risk prevention and control capabilities of the banking system and financial stability and security. The level of net interest margin in the banking sector is basically close to the bottom line of long-term financial stability. It is imperative and urgent to control the cost of liabilities in the banking system.