Guan Cha Zhe Wang·2025-05-22 00:57Group 1 - The core viewpoint of the article is that several banks in China have announced a reduction in RMB deposit rates, following a trend initiated by major state-owned banks, which is linked to the recent decrease in the Loan Prime Rate (LPR) [1][4][5] Group 2 - On May 20, six state-owned banks and several others, including China Merchants Bank and China Everbright Bank, announced a reduction in RMB deposit rates, with the adjustment range being 5 to 25 basis points [1] - Following this, on May 21, seven additional banks, including Ping An Bank and CITIC Bank, also announced similar reductions, with the new rates for demand deposits set at 0.05% and various fixed-term deposit rates adjusted accordingly [1][2] - The new fixed-term deposit rates for three months, six months, one year, two years, three years, and five years are 0.7%, 0.95%, 1.15%, 1.20%, 1.30%, and 1.35% respectively [1] - The recent LPR adjustments include a decrease in the 5-year LPR to 3.5% and the 1-year LPR to 3%, both down by 0.1% from the previous month [4] - The reduction in deposit rates is expected to lead to an overall decrease in deposit rates by approximately 0.11 to 0.13 percentage points, which may help stabilize banks' net interest margins [4][5] - As of the first quarter of 2025, the net interest margin for commercial banks was reported at 1.43%, a decrease of 0.09 percentage points, marking a historical low [5]