Core Insights - The banking deposit business is experiencing a "temperature difference" phenomenon, with personal fixed deposits showing significant growth while demand for current deposits is uneven across banks [1][3][10] Group 1: Personal Fixed Deposits - Personal fixed deposit balances across nine listed banks showed positive year-on-year growth in the first three quarters of 2025, with notable increases from Hangzhou Bank (29.12%), Chengdu Bank, and Nanjing Bank (both over 24%) [3][4] - City commercial banks are performing well due to their deep ties with regional economies and flexible product innovation strategies [3][4] - The growth in personal fixed deposits reflects a shift in residents' asset allocation preferences, driven by lower risk tolerance amid market volatility [5][10] Group 2: Current Deposits - Current deposit growth is characterized by significant disparities, with some banks experiencing strong growth while others face declines [6][7] - Shanghai Pudong Development Bank reported a current deposit balance of 4,617.38 billion yuan, growing by 11.80% year-on-year, attributed to effective deposit management strategies [6][7] - Some regional banks, like Ruifeng Rural Commercial Bank, reported a decline in current deposits, indicating challenges in maintaining customer loyalty and competitive positioning [8][9] Group 3: Industry Trends and Strategies - The overall increase in household deposits and the rise of net worth management products indicate a shift in the banking industry's competitive landscape, moving from scale competition to a focus on comprehensive financial service capabilities [10][12] - Banks are adopting differentiated strategies to attract long-term funds and enhance service offerings, with a focus on optimizing deposit structures and managing costs effectively [11][12] - The trend of fixed deposits is expected to continue as interest rates decline, prompting banks to adapt their strategies to align with changing resident asset allocation needs [12]

Core Viewpoint - The recent trend in China's banking sector shows a significant downward adjustment in deposit interest rates, particularly among small and medium-sized banks, with some banks making multiple adjustments within a month [1][2][3] Group 1: Deposit Rate Adjustments - Several small and medium-sized banks have announced reductions in deposit interest rates, with decreases ranging from 5 basis points to 170 basis points [1] - For instance, Qingxu Rural Commercial Bank adjusted its deposit rates for various terms, with the 3-month, 6-month, 1-year, 2-year, 3-year, and 5-year rates set at 1%, 1.2%, 1.6%, 1.7%, 1.9%, and 1.9% respectively [1] - Deqing Rural Commercial Bank also lowered its 1-year, 2-year, 3-year, and 5-year deposit rates by 5, 10, 10, and 25 basis points to 1.65%, 1.7%, 1.95%, and 1.8% respectively [1] Group 2: Impact on Private Banks - Private banks, which previously offered the highest deposit rates, are now significantly lowering their rates, bringing them closer to those of state-owned banks, with some rates even falling below those of joint-stock banks [2] - For example, WeBank announced a reduction in its fixed deposit rates across various terms, with the 5-year, 3-year, 2-year, and 1-year rates all set at 1.60%, reflecting a decrease of 40 basis points for longer terms and 20 basis points for the 1-year term [2] Group 3: Market Dynamics and Future Outlook - According to industry experts, the ongoing decline in deposit rates is influenced by factors such as market competition, customer positioning, and liability structure among different banks [3] - The reduction in deposit rates is expected to help private banks maintain stable interest margins and enhance their development capabilities [3] - As deposit rates decrease and consumer expectations improve, the attractiveness of capital and wealth management markets may increase, leading to continued pressure on banks to lower deposit rates further [3]

Core Viewpoint - A wave of interest rate cuts is occurring in China, with multiple banks reducing deposit rates to alleviate pressure on their liabilities, following a trend initiated by several small and medium-sized banks [1][5][6]. Summary by Category Deposit Rate Adjustments - Several banks, including regional and private banks, have announced reductions in deposit rates effective from late April to early May. For instance, a bank in Henan has adjusted its one-year, two-year, three-year, and five-year deposit rates to 1.8%, 1.8%, 2.05%, and 1.95%, respectively, down by 10 to 15 basis points from rates effective March 1 [1][2]. - Xinjiang Fuhai Rural Commercial Bank has lowered its one-year deposit rate from 1.75% to 1.7%, and its two-year rate from 1.95% to 1.8%, among other adjustments [2][4]. Market Trends and Predictions - The trend of interest rate cuts is driven by net interest margin pressures and a response to policy guidance and market expectations. Many banks are adapting to lower market interest rates to stabilize interest income and explore non-interest income sources [5][6]. - Analysts predict that deposit rates still have room for further reductions, with expectations that rates will align closely with policy rate declines. The market is observing a significant drop in government bond yields compared to policy rates, indicating potential for further decreases in asset yields [5][6]. Monetary Policy Implications - The recent statements from the political bureau regarding monetary policy suggest a shift towards more timely adjustments in reserve requirement ratios and interest rates, with expectations that deposit rates will be prioritized over Loan Prime Rate (LPR) adjustments [6][7]. - It is anticipated that the current round of deposit rate adjustments will begin with small and medium-sized banks, aiming to minimize the impact on larger banks while ensuring liquidity support for major bondholders [7].