Core Viewpoint - The collaboration between bank wealth management subsidiaries and rural commercial banks is accelerating, driven by the need to counteract declining deposit rates and retain customer deposits while expanding market reach and product offerings [2][3][4]. Group 1: Collaboration Dynamics - Bank wealth management subsidiaries are actively seeking partnerships with rural commercial banks to enhance distribution channels and customer coverage, particularly in response to declining deposit rates [2][4]. - Several rural commercial banks have recently signed agreements with wealth management subsidiaries, indicating a surge in collaboration efforts [2][4]. - The urgency for these partnerships is underscored by the significant outflow of personal deposits from rural banks as deposit rates fall below 2%, prompting banks to seek alternative investment products [3][5]. Group 2: Market Trends and Challenges - The average annualized returns for closed-end fixed-income products have reached 2.3% and 2.73% for one-month and three-month periods, respectively, making these products attractive for rural banks to retain deposits [4]. - A notable trend is the shift in customer preference towards fixed-income wealth management products as deposit rates decline, with rural residents showing a strong interest in these offerings [3][6]. - The implementation of stricter regulations under the "Measures for the Management of Agency Sales by Commercial Banks" has raised the compliance requirements for partnerships, leading rural banks to focus more on operational compliance and risk management [8][9]. Group 3: Product Development and Risk Management - Rural banks are primarily interested in low-risk fixed-income products due to the conservative risk appetite of their clientele, with many banks planning to continue offering only these types of products [6][7]. - There is a concern that if fixed-income product yields fall below 2%, it could lead to another wave of deposit outflows, prompting banks to explore innovative product structures to maintain competitive returns [6][7]. - To enhance the yield of fixed-income products, banks are considering diversifying investments into alternative strategies while ensuring low volatility to meet customer expectations [7]. Group 4: Compliance and Operational Adjustments - The new regulatory framework requires rural banks to implement stricter internal controls and compliance measures, including a focus on sales practices and customer suitability [8][9]. - Some rural banks are taking proactive steps to improve compliance, such as enhancing communication with wealth management subsidiaries and training staff on sales practices to prevent mis-selling [9][10]. - The emphasis on compliance is critical, as any increase in customer complaints could jeopardize ongoing partnerships with wealth management subsidiaries [10].

Core Viewpoint - The competition among bank wealth management subsidiaries and rural commercial banks has intensified, with a focus on establishing distribution agreements for wealth management products to capture the shifting deposit landscape in rural areas [2][4]. Group 1: Market Dynamics - Since December 2025, there has been a noticeable acceleration in cooperation between bank wealth management subsidiaries and rural commercial banks [2][4]. - Rural commercial banks are actively seeking partnerships with bank wealth management subsidiaries to counteract the decline in self-managed wealth management products and to retain customer deposits [4][6]. - The average annualized yield of closed-end fixed-income products from wealth management companies reached 2.3% and 2.73% for one-month and three-month products, respectively, as of Q3 2025 [6]. Group 2: Deposit Trends - A significant drop in one-year deposit rates below 2% has led to a 6% loss in personal deposits for some rural commercial banks, highlighting the urgency to attract deposits through wealth management products [5][7]. - The trend of declining deposit willingness among rural residents is evident, with a shift towards higher-yielding wealth management products as deposit rates fall [5][9]. - The third quarter of 2025 saw new open-end wealth management products' performance benchmark drop to 2.08%, nearing the critical 2% threshold [9]. Group 3: Regulatory Environment - The implementation of the "Management Measures for Commercial Banks' Agency Sales Business" in October 2025 has raised the compliance requirements for cooperation between rural commercial banks and wealth management subsidiaries [11]. - Rural commercial banks are now focusing on the operational compliance of product distribution, requiring a comprehensive internal control system covering product approval, sales, and customer complaint management [11][12]. - There is a growing emphasis on ensuring that the risk profiles of wealth management products align with the risk tolerance of rural customers to prevent mis-selling and customer complaints [12]. Group 4: Product Development - To enhance the yield of fixed-income wealth management products, bank wealth management subsidiaries are exploring tailored investment products for rural residents, aiming to maintain annualized returns above 2% [10]. - The shift towards pure fixed-income products is prevalent among rural commercial banks, reflecting the low-risk appetite of local investors [9][10]. - The number of institutions cross-selling wealth management subsidiary products has increased to 583 by Q3 2025, with 402 banks transitioning to pure distribution models [10].