3 6 Ke·2025-12-04 10:37Core Viewpoint - The banking industry is facing pressure on net interest margins, leading to a control on liabilities and a reduced likelihood of a deposit competition by the end of 2025 [1][6]. Group 1: Deposit Products and Interest Rates - Some banks have temporarily suspended the issuance of term deposits of 1 year and above, with current rates for shorter-term deposits ranging from 1.25% to 1.45% [1][3]. - Six major state-owned banks have collectively removed 5-year large certificates of deposit (CDs) from their offerings, while still providing various term deposit products with maximum rates of 1.3% [1][4]. - The interest rates for 1-year, 2-year, 3-year, and 5-year term deposits from state-owned banks are approximately between 0.95% and 1.3% [4][5]. Group 2: Net Interest Margin and Loan Quality - As of the end of Q3 2025, the net interest margin for commercial banks was 1.42%, remaining stable compared to Q2 but down by 11 basis points year-on-year [6][7]. - The non-performing loan ratio for commercial banks was 1.52%, an increase of 0.03 percentage points from the previous quarter [1]. - The net interest margin for joint-stock banks and rural commercial banks was relatively higher at 1.56% and 1.58%, respectively, while state-owned banks and city commercial banks had lower margins of 1.31% and 1.37% [7]. Group 3: Strategic Adjustments in Banking - Banks are optimizing their liabilities as a core strategy, with many large and medium-sized banks ceasing the issuance of long-term large CDs since Q2 2024 [4][6]. - The banking sector is focusing on aligning loan pricing with business risks to maintain reasonable net interest margins, amidst concerns of a potential "inversion" between non-performing rates and net interest margins [6][7]. - The trend of deposit rates being lowered has been ongoing, with the latest adjustments occurring on May 20, 2025, marking the seventh reduction since September 2022 [5].