Group 1 - In 2025, the balance of household deposits exceeded 156 trillion yuan, showing a year-on-year increase of 14.3%, but the reality is that this "money bag" is riddled with issues as the real estate market collapses and prices plummet [1] - The decline in deposit interest rates, with three-year fixed deposit rates dropping from 3.5% to 1.95%, has led to a situation where depositors' earnings are being eroded by inflation, as indicated by the central bank's report on financial stability [2] - The shift of deposits to the wealth management market is evident, with public fund issuance increasing by 47% year-on-year in the first half of 2025, as low bank interest rates push individuals to seek higher returns [3] Group 2 - The financial market is experiencing a "bloody hunt," with significant losses reported in the A-share market, where the total market value evaporated by 26.94 trillion yuan, leading to severe consequences for investors, particularly the elderly [4] - High household debt levels, with a leverage ratio of 61.5%, are contributing to consumer anxiety, as rising living costs outpace wage growth, forcing families to cut back on spending [5] - Strategies for protecting personal finances include ladder savings methods and defensive investment strategies, emphasizing the importance of avoiding high-risk investment products that promise unrealistic returns [6]

Core Viewpoint - The five-year large denomination certificates of deposit (CDs) are becoming increasingly rare as major banks like Industrial and Commercial Bank of China, China Merchants Bank, and CITIC Bank have begun to withdraw these products from the market, indicating a strategic shift in response to declining interest margins [1] Group 1: Market Trends - Major banks and some city commercial banks have removed five-year large denomination CDs from their offerings, with some banks reducing the maximum term for available CDs to two years [1] - This trend reflects banks' proactive adjustments to manage declining interest margins and to lower funding costs [1] Group 2: Strategic Adjustments - Banks are lowering the interest rates on long-term large denomination CDs and even suspending the issuance of three- and five-year products to avoid locking in high-interest liabilities [1] - The aim of these adjustments is to mitigate the risk of future cost and revenue mismatches in funding [1]

Core Viewpoint - The trend of large-denomination certificates of deposit (CDs) with a five-year term is declining as banks adjust their strategies to manage interest margin pressures due to falling asset yields and high funding costs [1][2][3]. Group 1: Changes in Large-Denomination CDs - Many banks have reduced the maximum term for large-denomination CDs to two years, reflecting a broader trend of shortening deposit terms [2][3]. - The interest rates for three-year CDs have dropped significantly, with rates now in the range of 1.55% to 1.75%, down approximately 80 basis points compared to the same period in 2024 [3][4]. - The withdrawal of five-year CDs is part of a strategy to optimize the liability structure and reduce funding costs, as these long-term products are seen as high-cost liabilities [2][4]. Group 2: Impact on Banking Strategies - Banks are actively promoting short-term and structured deposit products to maintain flexibility in their funding strategies and to attract customers away from high-cost long-term deposits [4][5]. - The narrowing of net interest margins has prompted banks to lower deposit rates across various terms, indicating a strategic shift to manage costs effectively [4][5]. - Regulatory guidance is also influencing banks to adjust their liability structures, with a focus on reducing high-interest long-term deposit products to support economic financing [3][4]. Group 3: Investor Strategies - Investors are advised to reconsider their asset allocation strategies in light of the changing landscape of deposit products, with recommendations to diversify into short-term deposits, government bonds, and structured financial products [5][6]. - The current environment suggests that over-reliance on traditional deposits may lead to returns that lag behind inflation, prompting a need for a more balanced investment approach [5][6]. - For investors with higher risk tolerance, there is an encouragement to explore equity assets alongside fixed-income products to enhance long-term returns [5][6].

Core Viewpoint - The trend of major banks in China, including Industrial and Commercial Bank of China, China Merchants Bank, and CITIC Bank, is to withdraw five-year large denomination certificates of deposit (CDs) and shorten the maximum term of available CDs to two years, in response to declining interest margins [1][3]. Group 1: Bank Actions - Major banks are actively reducing long-term liabilities by lowering the interest rates on long-term large denomination CDs or even suspending the issuance of three and five-year products to mitigate the risk of future cost-revenue inversion [1][4]. - As of recent searches, five-year large denomination CDs are no longer available on the apps of major state-owned banks, with the longest available term being three years at a rate of 1.55% [1]. - China Merchants Bank has also removed three and five-year large denomination CDs from sale, currently offering only products with terms of two years or less, with rates below 2.15% [3]. Group 2: Interest Rate Trends - The average interest rates for one-year, two-year, three-year, and five-year large denomination CDs are reported as 1.719%, 1.867%, 2.197%, and 2.038% respectively, indicating a general decline in rates [4]. - The interest rates for three-year large denomination CDs have decreased by approximately 80 basis points compared to the same period in 2024, with current rates concentrated between 1.55% and 1.8% [3]. - The latest seven-day annualized yield for Tianhong Yu'ebao has reached 1.18%, which is close to the one-year large denomination CD rate of 1.2%, highlighting the diminishing advantage of large denomination CDs in terms of interest rates [3]. Group 3: Industry Context - The banking sector is currently facing low net interest margins, with the net interest margin further declining to 1.43% in the first quarter of 2025, down 9 basis points from the end of 2024 [4]. - The pressure on net interest margins is exacerbated by the continuous decline in loan yields due to multiple reductions in the Loan Prime Rate (LPR), while the trend of increasing fixed-term deposits intensifies the burden of high-interest liabilities [4][5]. - The suspension of five-year large denomination CDs and the reduction of medium to long-term deposit products are necessary measures for banks to lower funding costs and stabilize net interest margins [5].