Core Viewpoint - Major Chinese banks, including ICBC, CCB, and CMB, have recently suspended the issuance of 5-year large-denomination certificates of deposit (CDs) as a strategy to reduce funding costs amid low net interest margins in the banking sector [1] Group 1: Banking Sector Actions - Several large and medium-sized commercial banks, along with rural commercial banks, have withdrawn 5-year large-denomination CDs from the market [1] - The issuance volume of 3-year large-denomination CDs has also decreased significantly [1] Group 2: Financial Strategy - The banking industry is currently facing low net interest margins, prompting banks to explore ways to stabilize these margins by reducing funding costs [1] - Deposits are a primary source of liabilities for banks, making it essential to lower the costs associated with deposits [1] Group 3: Expert Recommendations - Experts suggest that in a low-interest-rate environment, households should adopt a "fixed income +" strategy by allocating investments in medium- and short-term bond funds [1] - Additionally, global asset allocation is recommended to capture economic growth opportunities worldwide [1]

Group 1 - Major commercial banks, including ICBC, CCB, and CMB, have recently suspended 5-year large-denomination certificates of deposit (CDs), with a reduced issuance of 3-year CDs as well [1] - The suspension of 5-year CDs is a strategy to lower funding costs as banks face low net interest margins and need to stabilize them by reducing liabilities [1] - The overall trend in the financial market shows a simultaneous decline in both deposit and loan interest rates, which is necessary for stabilizing banks' net interest margins and better serving the real economy [1] Group 2 - In May, a significant adjustment in deposit interest rates occurred, with major state-owned banks leading the way, resulting in medium- and long-term deposit rates entering the "1%" era [2] - The withdrawal of 5-year large-denomination CDs indicates a diminishing opportunity for investors to rely on medium- to long-term savings for wealth preservation and growth, highlighting the need for diversified investment strategies [2] - Investors are advised to compare different financial products, focus on interest rate trends, and choose products with better overall returns, while also being aware of the terms and conditions of these products [2] Group 3 - Investors are encouraged to allocate a portion of their portfolios to high-rated bonds and bond funds to complement savings with stable returns [3] - For those with higher risk tolerance, investing in equity assets through index funds can provide long-term capital appreciation potential [3] - Establishing a dynamic rebalancing mechanism is recommended to adjust asset allocations based on economic conditions and market valuations, achieving an effective balance between risk and return [3]

Core Viewpoint - A new wave of interest rate cuts is occurring among banks, particularly affecting deposit rates, with many commercial banks, especially private and rural banks, leading the reductions [2][8]. Group 1: Interest Rate Cuts - Several commercial banks, including Ping An Bank and Hengfeng Bank, have recently lowered their deposit rates, with Ping An Bank reducing its 3-year deposit rate from 2.05% to 1.65%, a decrease of 40 basis points [2][3]. - Over half of the private banks have cut their deposit rates in April, indicating a trend towards lower rates across the sector [2][7]. - Hengfeng Bank has also adjusted its deposit rates, with 1-year, 2-year, and 3-year rates now at 1.65%, 1.8%, and 2.15%, respectively, down from 1.8%, 1.95%, and 2.35% in February [4]. Group 2: Market Dynamics - The adjustments in deposit rates are attributed to several factors, including insufficient effective demand for credit, which pressures banks to manage their funding costs more effectively [8]. - The expectation of further monetary easing, including potential rate cuts, is influencing banks to adopt more proactive deposit pricing strategies [8]. - The competition among banks, particularly private banks, is intensifying as they seek to attract deposits while managing profitability, leading to varied responses in rate adjustments [10]. Group 3: Customer Impact - Customers are experiencing confusion due to the rapid and sometimes unexpected changes in deposit rates, with some high-yield products being quickly withdrawn from the market [3][4]. - Banks are advising customers to consider longer-term deposits to lock in current rates before further declines occur [6].