Core Viewpoint - The recent trend of declining deposit rates among private banks is a rational response to the macroeconomic downturn and loose monetary policy, aimed at controlling high-interest deposit risks and avoiding margin compression [1][3]. Group 1: Deposit Rate Adjustments - On February 25, Shanghai Huari Bank announced a reduction in its deposit rates by 5 basis points, with 2-year and 5-year products falling below 2% [2]. - Other private banks, such as Jiangxi Yumin Bank and Tianjin Jincheng Bank, have also adjusted their deposit rates, particularly for medium to long-term deposits [2]. - Jiangxi Yumin Bank's 2-year personal fixed deposit rate was lowered to 2.2%, while its 1-year and 2-year products have rates of 1.70% and 2.20%, respectively [2]. Group 2: Impact on Net Interest Margin - As of the end of Q4 2025, the net interest margin for commercial banks remained at a historical low of 1.42%, with private banks slightly narrowing their margins [4]. - The net interest margin for private banks was reported at 3.95% in Q1 2025, decreasing to 3.83% by Q4 2025, reflecting a decline of 0.27 percentage points from the end of 2024 [4]. - The loan market interest rate (LPR) has remained unchanged for nine months, with the 1-year LPR at 3% and the 5-year LPR at 3.5% [4]. Group 3: Future Strategies for Private Banks - Private banks need to balance profitability with serving the real economy, focusing on digital transformation and expanding inclusive finance and intermediary services [5]. - There is a need to optimize asset-liability structures and strengthen capital replenishment while exploring diversified income channels such as wealth management and ecosystem cooperation [6].