Core Viewpoint - The article discusses the emergence of "financial special forces" who actively manage their investments in financial products due to the declining interest rates on bank deposits, leading to a shift in focus towards wealth management products [1][10]. Group 1: Investment Behavior - "Financial special forces" invest significant time researching and comparing various financial products to maximize returns, often moving funds frequently between products to capture fleeting opportunities [1][3]. - An example is provided of an individual who shifted 1.5 million yuan from a fixed deposit with a 4.8% interest rate to cash management products, reflecting a broader trend among investors [3][5]. - Social media platforms have seen a rise in discussions among these investors about product performance, indicating a community-driven approach to investment [3][4]. Group 2: Product Performance - Specific financial products, such as WeBank's "Current + Plus," have gained popularity due to their high annualized returns and T+0 trading capabilities, attracting the attention of these investors [4][5]. - For instance, the "Solid Income Pure Bond 7R" product has shown an annualized return of 5.35% since inception, outperforming many traditional deposit products [5]. Group 3: Market Trends - There is a noticeable trend of funds moving from traditional bank deposits to alternative investment products like wealth management and money market funds, driven by the low-interest-rate environment [10][12]. - In May, the increase in RMB deposits was 2.18 trillion yuan, with non-bank deposits reaching a ten-year high, suggesting a shift in investor behavior towards higher-yielding alternatives [10][12]. - The article notes that the average annualized return for bank wealth management products in May was 2.57%, which is more attractive compared to declining deposit rates [12]. Group 4: Regulatory Considerations - The concentration of funds in low-risk products may lead to potential risks such as duration mismatch and high asset concentration, prompting the need for regulatory oversight [13].

Core Insights - The emergence of "wealth management special forces" is noted as individuals shift focus from traditional deposit accounts to wealth management products due to declining interest rates [1][2] - These individuals actively research and compare various wealth management products to maximize returns, often moving funds frequently to capture fleeting opportunities [2][3] Wealth Management Trends - A growing number of investors, referred to as "wealth management special forces," are increasingly engaging in active management of their investments, moving funds based on daily performance [2][3] - Social media platforms have seen a rise in discussions about wealth management products, with many users sharing insights on product performance and optimal timing for investment [2][3] Product Performance and Strategies - Specific products, such as WeBank's "Current + Plus," are highlighted for their attractive annualized returns and T+0 trading capabilities, making them popular among active investors [3][4] - For instance, the "Solid Bond Pure Debt 7R" product has shown an annualized return of 5.35% since inception, outperforming many traditional deposit options [4] Market Dynamics - The overall trend indicates a significant shift of funds from traditional bank deposits to wealth management and money market funds, driven by lower interest rates on deposits [7][8] - In May, RMB deposits increased by 2.18 trillion yuan, with non-bank deposits reaching a ten-year high, suggesting a potential shift in investor behavior towards alternative assets [7] Regulatory and Competitive Landscape - The competition among banks to offer attractive wealth management products is intensifying, with some institutions launching short-term high-yield products to attract investors [8][9] - The average annualized return for bank wealth management products in May was reported at 2.57%, with cash management products yielding 1.49% and pure debt products at 2.69% [9]

Core Viewpoint - The People's Bank of China reported a significant increase in RMB deposits in May, driven by a surge in non-bank financial institution deposits, which reached a near ten-year high, indicating a shift in asset allocation preferences among residents and enterprises towards higher-yielding non-bank financial products [1][2]. Group 1: Deposit Growth and Structure - In May, non-bank deposits increased by 1.19 trillion yuan, marking the highest growth for the same period in nearly a decade [2]. - Cumulatively, non-bank deposits have risen by 3.07 trillion yuan this year, which is 680 billion yuan more than the same period last year [2]. - The increase in non-bank deposits is attributed to the declining deposit interest rates, prompting a "migration effect" where individuals and businesses prefer to allocate assets through non-bank institutions [2][3]. Group 2: Interest Rate Impact - The continuous decline in deposit rates has led to a shift in asset allocation from traditional bank deposits to higher-yielding financial products such as money market funds and cash management products [2][4]. - Major state-owned banks and joint-stock banks have lowered deposit rates, with the one-year fixed deposit rate reduced to 0.95% [2]. - This trend is expected to persist, as lower deposit rates encourage more funds to flow into consumption and investment activities, enhancing economic vitality and optimizing asset allocation [4][5]. Group 3: Diversification of Asset Allocation - There is a notable shift from "single deposits" to a diversified approach involving "wealth management + equities," driven by the deepening of interest rate marketization [4]. - The changing asset allocation mindset among residents is likely to lead to increased investments in stock markets, bond funds, private asset management products, and insurance savings products [4]. - The ongoing trend of deposit migration is expected to continue, with funds increasingly directed towards money market funds, bank wealth management, bond markets, and stock markets [4][5].

Core Viewpoint - The article discusses a significant shift in the deposit interest rate strategies of small and medium-sized banks in China, as they rapidly follow the lead of large state-owned banks in reducing deposit rates, moving away from their traditional high-interest deposit attraction methods [1][3]. Group 1: Deposit Rate Changes - A new wave of deposit rate cuts has been initiated by small and medium-sized banks, particularly in regions like Guangdong and Sichuan, with some rural commercial banks lowering their three-year fixed deposit rates to 1.2%, which is 5 basis points lower than the rates offered by large banks [1][3]. - The speed of this rate cut transmission from large banks to small banks is notably faster compared to previous cycles, with some banks reducing rates multiple times within a short period [3][4]. - As of June 1, certain small banks, such as Beijing Huairou Rongxing Village Bank, have set their three and five-year deposit rates at 1.20%, lower than the rates of major banks [3][4]. Group 2: Strategic Shift in Banking Operations - Small and medium-sized banks are abandoning their reliance on high-interest deposits due to the increasing burden of high-cost liabilities amidst declining loan rates [6][8]. - The overall net interest margin for commercial banks has narrowed, with the first quarter of 2025 showing a decrease of 9 basis points year-on-year, particularly affecting rural commercial banks which saw a significant drop of 15 basis points [6][7]. - The focus of these banks is shifting from aggressive deposit acquisition to optimizing existing funds and controlling costs, reflecting a broader change in operational strategy [6][8]. Group 3: Market Implications - The rapid reduction in deposit rates may lead to an increase in deposit migration, as the attractiveness of traditional bank deposits diminishes [10][11]. - The decline in deposit rates is expected to drive more funds into low-risk asset management products, enhancing the influence of the bond market [11]. - The current deposit rate for one-year deposits is at 0.95%, while the yield on one-year negotiable certificates of deposit (NCD) is at 1.68%, indicating a potential for deposit disintermediation [10][11].

Core Viewpoint - The recent trend shows that some small and medium-sized banks have lowered their deposit rates below those of large state-owned banks, marking a significant shift in the competitive landscape of the banking sector [1][2][4]. Group 1: Deposit Rate Changes - Following the initiation of a new round of deposit rate cuts by large state-owned banks, small and medium-sized banks have quickly followed suit, with some even abandoning their traditional strategy of attracting deposits through high interest rates [1][2]. - In regions like Guangdong and Sichuan, small banks have initiated a wave of deposit rate cuts, with some three-year fixed deposit rates dropping to 1.2%, which is 5 basis points lower than the rates offered by large banks [1]. - As of June 1, certain small banks, such as Beijing Huairou Rongxing Village Bank, have reduced their three-year and five-year deposit rates to 1.20%, which is below the rates of major commercial banks [2][3]. Group 2: Strategic Shift in Banking Operations - The reduction in deposit rates reflects a strategic shift among small and medium-sized banks from focusing on growth through deposit accumulation to optimizing their cost structures amid narrowing interest margins [1][4]. - Many small banks are now prioritizing the management of existing funds over aggressive deposit acquisition, indicating a significant change in operational focus [5][6]. - The net interest margin for commercial banks has been under pressure, with the overall net interest margin reported at 1.43% for Q1 2025, a decrease of 9 basis points from the previous quarter [6]. Group 3: Market Implications - The rapid decline in deposit rates among small banks may accelerate the trend of deposit migration, as the attractiveness of these banks diminishes [7][8]. - The reduction in deposit rates is expected to lead to increased flows into non-bank financial products, which could enhance the influence of the bond market [8]. - The current environment may also push broader interest rates, including government bond rates, further downward due to reduced deposit attractiveness [8].

Group 1 - The State Council has deployed new measures to stabilize the real estate market, focusing on stabilizing expectations, activating demand, optimizing supply, and mitigating risks [2] - Central and local governments will coordinate policies to implement targeted measures for the real estate market [2] Group 2 - In May, non-bank deposits in China reached a nearly ten-year high, with a monthly increase of nearly 1.2 trillion yuan, reflecting significant changes in fund flows [4] - The total RMB deposit balance reached 316.96 trillion yuan, with a year-on-year growth of 8.1% [4] Group 3 - The pharmaceutical sector is experiencing a surge, with nine out of the top ten actively managed equity funds being healthcare-themed, highlighting a significant shift in fund performance rankings [5] - The top-performing fund, Huatai-PineBridge Hong Kong Advantage Select A, achieved a return of 103.67% [5] Group 4 - The Hang Seng AH Premium Index has dropped to its lowest level in five years, with a decline of over 10% year-to-date [6] - As of June 13, 42 companies still have an AH premium rate exceeding 100%, while some companies are showing a discount of H-shares compared to A-shares [6] Group 5 - The Shenzhen pilot program for red-chip companies to list in Hong Kong has garnered attention, with expectations for enhanced investor confidence in China's capital market [7] - The policy aims to facilitate financial collaboration in the Guangdong-Hong Kong-Macao Greater Bay Area [7] Group 6 - The trend of companies issuing "suspension warnings" is increasing, allowing investors to reassess their investment decisions [8] - This proactive approach provides a buffer period for investors to evaluate potential risks [8] Group 7 - The announcement of a three-year cumulative return for pension funds aligns with the trend of long-term investment assessments [9] - This new metric is intended to guide pension management institutions towards long-term investment strategies [9] Group 8 - Dongshan Precision plans to acquire Source Photonics for up to 59.35 billion yuan, marking a strategic move into the optical communication sector [13][14] - The acquisition will be executed through a combination of equity purchase and convertible bond subscription [13][14] Group 9 - Bozhong Precision announced a high acquisition premium of 352% for a 70% stake in Shanghai Wodian, aiming to enter the automotive intelligent equipment market [15]

Core Viewpoint - The article highlights significant changes in the flow of funds in the financial market, driven by a decline in deposit interest rates, leading to a "deposit migration" effect where individuals and businesses are shifting their funds to higher-yielding financial products like money market funds and cash management products [1][4][5]. Summary by Sections Deposit Growth - As of the end of May, the balance of RMB deposits reached 316.96 trillion yuan, a year-on-year increase of 8.1%, with new deposits in May amounting to nearly 2.2 trillion yuan, which is 500 billion yuan more than the same period last year [1][3]. - Non-bank deposits increased by 1.19 trillion yuan in May, marking the highest level for the same period in nearly a decade, with a year-on-year increase of 300 billion yuan [3][4]. Factors Influencing Non-Bank Deposits - The significant rise in non-bank deposits is closely linked to the increased activity in the financial market and a shift in fund flows, particularly due to the recent round of deposit rate cuts [4][5]. - Analysts suggest that the decline in deposit rates has led residents and some businesses to move their funds from demand deposits to higher-yielding financial products, directly contributing to the substantial growth in non-bank deposits [5][6]. Bank Wealth Management Growth - The continued growth of bank wealth management products serves as strong evidence of the "deposit migration" effect, with a month-on-month increase of 340 billion yuan in May, bringing the total to 31.6 trillion yuan [6]. - The performance of credit bonds has enhanced the attractiveness of wealth management products, providing stable underlying asset returns and improving investor experience, which in turn attracts more funds [6]. Monthly Deposit and Loan Growth Discrepancies - In May, while deposits saw a significant increase, RMB loans rose by only 620 billion yuan, a year-on-year decrease of 330 billion yuan, indicating a divergence in growth rates [12]. - Experts note that the differences in monthly deposit and loan growth reflect the diversification of financial institutions' assets and changes in financing structures, necessitating a long-term perspective on these dynamics [12][14]. Economic Context and Market Sentiment - The resilience in May's data is attributed to a series of financial support measures that have boosted market confidence, leading to signs of recovery in investment and consumption activities [10]. - The overall increase in deposits is also influenced by the gradual release of fiscal funds and the recovery of local government financing, which supports the demand for demand deposits [10][13].

Core Viewpoint - The article highlights significant changes in the flow of funds in the financial market, driven by a decline in deposit interest rates, leading to a "deposit migration" effect where individuals and businesses are shifting their funds to higher-yielding financial products like money market funds and cash management products [1][4][6]. Group 1: Deposit Growth - As of the end of May, the balance of RMB deposits reached 316.96 trillion yuan, a year-on-year increase of 8.1%, with new deposits in May amounting to nearly 2.2 trillion yuan, which is 500 billion yuan more than the same period last year [1][3]. - Non-bank deposits increased by 1.19 trillion yuan in May, marking the highest level for the same period in nearly a decade, with a year-on-year increase of 300 billion yuan [3][4]. - The total scale of bank wealth management products grew by 340 billion yuan month-on-month in May, reaching 31.6 trillion yuan, further evidencing the "deposit migration" effect [6]. Group 2: Factors Influencing Deposit Changes - Analysts attribute the significant changes in non-bank deposits to increased market activity and shifts in fund flows, particularly due to the recent round of deposit rate cuts, which has led to a decrease in deposit yields [4][5]. - The decline in deposit rates has prompted residents and businesses to move their funds from demand deposits to higher-yielding financial products, thus driving the substantial growth in non-bank deposits [6][10]. - The increase in household deposits by 470 billion yuan in May, along with a decrease in non-financial corporate deposits by 417.6 billion yuan, reflects a complex interplay of seasonal factors and economic conditions [8][9]. Group 3: Loan Growth Dynamics - In contrast to the significant increase in deposits, RMB loans rose by 620 billion yuan in May, which is 330 billion yuan less than the same period last year, indicating a divergence in deposit and loan growth [12]. - The disparity in monthly growth rates of deposits and loans is seen as a reflection of the diversification of financial institutions' assets and changes in financing structures [12][14]. - The overall average growth rates for deposits and loans since 2021 have been approximately 9% and 9.6%, respectively, suggesting a long-term balance despite monthly fluctuations [12][13].

Report Industry Investment Rating The provided content does not mention the report industry investment rating. Core Viewpoints - In the future week, the net payment scale of government bonds will decline, and the tax period will disrupt the capital market. Considering the central bank's care for the capital market and the adequacy of its toolbox, the capital market is expected to maintain a balanced and slightly loose operation [1]. - In the future week, the maturity scale of certificates of deposit (CDs) will exceed one trillion, with significant supply pressure. However, the central bank's second - round injection of medium - and long - term funds is expected to marginally relieve the issuance pressure of CDs, and CD yields may show a fluctuating downward trend [1]. - Funds have become the main buyer of interest - rate bonds, with a significant increase in net buying volume in the past week, while rural commercial banks have become the main seller [1]. Summary by Directory 1. Weekly Liquidity Tracking 1.1 Fund Review: The Central Bank Announces Another Injection of Medium - and Long - term Liquidity - In the statistical period (June 9 - 13, 2025), 7 - day reverse repurchase funds of 930.9 billion yuan matured, and the central bank injected 858.2 billion yuan of 7 - day funds, resulting in a net withdrawal of 7.27 billion yuan for the whole week, and the OMO stock decreased to 858.2 billion yuan. The central bank announced a second - round 40 - billion - yuan outright reverse repurchase operation for the next week, achieving a net injection for the whole month [10]. - During the statistical period, the spot exchange rate of the RMB against the US dollar depreciated by 1.52 basis points due to the uncertainty of US tariffs and the increasing expectation of a Fed rate cut [10]. - In terms of government bond progress, in the past week, the net financing of treasury bonds was 262.06 billion yuan, and the net financing since the beginning of the year was 3.10409 trillion yuan, completing 46.6% of the annual plan. The issuance of new local bonds was 8.372 billion yuan, and the issuance since the beginning of the year was 2.00893 trillion yuan, completing 38.6% of the annual plan, with a slowdown in the issuance speed. As of June 13, 1.68 trillion yuan of special refinancing bonds for replacing implicit debts had been issued, completing 84.2% of the annual plan [13]. - In terms of capital structure, the lending scale of state - owned and joint - stock banks increased significantly to over 4.5 trillion yuan, the lending scale of money market funds and wealth management products decreased, and the overall borrowing scale of non - banking institutions decreased slightly. The DR series declined, with overnight rates operating near the policy rate, and the spread between 7 - day rates and the policy rate narrowed to 10bp. The R series rose, and the liquidity stratification increased slightly but remained at a low level. The capital market showed a situation of "increasing volume and decreasing price" throughout the week, with a marginal tightening feeling on Thursday and Friday, and a balanced feeling for the whole week [15]. 1.2 CD Review: The Secondary - Market Interest Rate of CDs Declined Slightly, and the Demand from Core Buyers Strengthened - In the primary market, the net financing scale of inter - bank CDs was - 16.226 billion yuan in the statistical period, with a total issuance of 104.137 billion yuan and a maturity of 120.363 billion yuan. In the next three weeks, 102.164 billion, 113.781 billion, and 24.579 billion yuan of inter - bank CDs will mature respectively. The primary issuance rate decreased slightly, with an average issuance rate of 1.6744% (previous value: 1.7106%) [18]. - In the secondary market, core buyers such as funds and wealth management products continued to increase their holdings, money market funds changed from selling to buying, large - scale banks continued to reduce their holdings, city commercial banks and rural commercial banks changed from buying to selling, and insurance and other non - banking institutions and other product accounts continued to increase their holdings. The secondary - market yields of CDs fluctuated and declined slightly during the week, and the yield curve steepened slightly. The yields of 1M/3M/6M/9M/1Y CDs changed by - 1.78BP/ - 2.00BP/ - 1.50BP/ - 1.05BP/ - 0.91BP respectively [20]. 1.3 Next - Week Focus: The Central Bank's Firm Care for the Capital Market and the Marginal Relief of CD Issuance Pressure - In terms of the capital market, the May social financing data showed that the credit demand of residents and enterprises had recovered compared with April, with a weak stabilization of overall credit demand. The increase in government bond supply drove the stable growth of social financing, which is expected to support the key period of fiscal expenditure in June. After the deposit rate cut in May, the phenomenon of deposit transfer emerged, with a significant increase in non - banking deposits. The central bank announced a second - round injection of 40 billion yuan of 6 - month outright repurchase in the middle of the month. Combined with the previous 100 - billion - yuan 3 - month outright repurchase and the 120 - billion - yuan maturity this month, the net injection of outright reverse repurchases for the whole month was 20 billion yuan. The central bank's small - scale net withdrawal in open - market operations in the past two weeks also showed its care for the capital market. It is expected that the market will price a positive signal on June 16, but the amplitude will be smaller than that on June 6. In the next week, the net payment scale of government bonds will decline, and the tax period will disrupt the capital market. Considering the central bank's care and the adequacy of its toolbox, the capital market is expected to maintain a balanced and slightly loose operation [24]. - In terms of CDs, on the supply side, the net financing of CDs remained negative in the past week. The central bank's injection of medium - and long - term liquidity relieved the liability pressure of banks, and the primary - market interest rate of CDs decreased slightly. On the demand side, the demand from core buyers strengthened marginally, and the secondary - market yields of CDs fluctuated and declined slightly during the week. In the next week, the maturity scale of CDs will exceed one trillion, with significant supply pressure. However, the central bank's second - round injection of medium - and long - term funds is expected to marginally relieve the issuance pressure of CDs, and CD yields may show a fluctuating downward trend [25]. 2. Weekly Institutional Behavior Tracking Recent Considerations on Institutional Assets and Liabilities - The trends of the active bonds of 10 - year and 30 - year treasury bonds deviated significantly at times recently. The main reasons are that the supply rhythms of 10 - year and 30 - year treasury bonds were staggered in June, and the weak sentiment in the primary - market allocation disturbed the secondary - market. Since the beginning of the second quarter, interest rates have mainly fluctuated within a narrow range, and institutions had a strong desire to increase duration to obtain excess returns during the window of loose liquidity at the beginning of June. The trading volume of 30 - year treasury bonds increased more significantly than that of 10 - year treasury bonds. Looking forward, there will be no issuance pressure for 10 - year treasury bonds in the second half of June, and the capital price still shows certain volatility. The window period for institutions to increase duration may end, and the performance of 30 - year treasury bonds may not continue to outperform [27]. - The rotation of the bond - replacement market of China Development Bank (CDB) bonds has been very fast recently. When the bond - replacement of CDB active bonds accelerates, the volatility of new bonds will also increase. Therefore, the spread between 10 - year CDB bonds and 10 - year treasury bonds has fluctuated significantly recently. In the short term, old bonds may be safer to avoid volatility [28]. Key Review of Institutional Secondary - Market Transactions - Large - scale banks continued to buy treasury bonds with a maturity of less than 3 years, with a buying volume of about 77.6 billion yuan in the past week [31]. - Funds have become the main buyer of interest - rate bonds, with a net buying volume of about 160.4 billion yuan in the past week, showing a significant increase. Rural commercial banks have become one of the main sellers, with a net selling volume of about 109.2 billion yuan in the past week [31]. - The main buyers of CDs are money market funds, wealth management products, and other products, while the main sellers are city commercial banks and securities firms [31]. - The net buying volume of main non - banking buyers of credit bonds increased. Funds, wealth management products, and other products were the main net buyers, with funds having the largest increase. Since late March, the net buying volume of credit bonds with a maturity of less than 3 years has been generally stable, while the net buying volume of ultra - long - term credit bonds with a maturity of more than 5 years has fluctuated greatly, and the main non - banking buyers increased their buying volume significantly in the past week [31]. - For secondary - tier capital bonds, funds with a maturity of less than 2 years changed to net sellers, with a net selling volume of about 4.9 billion yuan in the past week, while wealth management products and other products changed to net buyers. The main buyers of 2 - 5 - year secondary - tier capital bonds continued to increase their buying volume, with funds having the largest net buying volume of about 36.2 billion yuan, and the banking system was the main net seller. The trading of 5 - 10 - year secondary - tier capital bonds remained light [31]. High - Frequency Data Tracking of Bond Market Micro - Structure - On June 13, the spread between 10 - year CDB bonds and 10 - year treasury bonds was 5.92bp, and the spread fluctuated and widened. The spread between 1 - year CDB bonds and R001 was 1.87BP, and the yield of short - term bonds was slightly higher than the capital price [33]. - The leverage ratio of the bond market in the week before the holiday was 107.72%, continuing to rise month - on - month [35].

Core Insights - The article highlights a significant shift in the flow of funds from traditional bank deposits to higher-yielding financial products such as money market funds and cash management products, driven by declining deposit interest rates [1][4]. Group 1: Financial Data Overview - As of the end of May, the balance of RMB deposits reached 316.96 trillion yuan, reflecting a year-on-year growth of 8.1%, with new deposits in May amounting to nearly 2.2 trillion yuan, an increase of 500 billion yuan compared to the same period last year [2]. - Non-bank deposits saw a substantial increase of 1.19 trillion yuan in May, marking the highest level for the same period in nearly a decade, with a year-on-year increase of 300 billion yuan [3]. - The total scale of bank wealth management products grew by 340 billion yuan month-on-month in May, reaching 31.6 trillion yuan, indicating a strong "deposit migration" effect [4]. Group 2: Market Dynamics - The decline in deposit interest rates has led to a "deposit migration" phenomenon, where both residents and enterprises are moving their funds to higher-yielding financial products [4][6]. - The increase in non-bank deposits is closely linked to heightened activity in the financial markets and a shift in fund flows, as evidenced by the significant rise in bank wealth management products [4][6]. - The overall growth in deposits in May is attributed to multiple factors, including improved market expectations, enhanced economic vitality, and increased demand for "liquid funds" from enterprises and residents [6][7]. Group 3: Loan and Deposit Growth Discrepancies - In May, RMB loans increased by 620 billion yuan, which is a year-on-year decrease of 330 billion yuan, indicating a divergence in the growth rates of deposits and loans [9][10]. - The differences in monthly growth rates of loans and deposits are seen as a reflection of the diversification of financial institutions' assets and changes in financing structures [10][11]. - The overall stability in the growth rate of combined bank deposits and wealth management products remains around 8%, suggesting a balanced financial environment despite monthly fluctuations [10][11].