Several state-owned banks will officially adjust RMB deposit interest rates, starting from June 8th
Following a report by reporters on June 6th that several state-owned banks will lower their deposit interest rates, involving both RMB and USD currencies, Securities Times reporters have learned exclusively from multiple sources that starting from June 8th, several state-owned banks will officially adjust their RMB deposit interest rates.
Among them, some major banks have adjusted the listing interest rates for RMB deposits, and the listing interest rates for current deposits have been reduced by 5 basis points to 0.2% compared to before. In the fixed deposit and withdrawal products, the listing interest rates for 3-month, 6-month, and 1-year deposits remain unchanged at 1.25%, 1.45%, and 1.65%, respectively. The listing interest rates for 2-year deposits have been reduced by 10 basis points to 2.05%, and the listing interest rates for 3-year and 5-year deposits have been reduced by 15 basis points to 2.45% and 2.5%, respectively. In addition, the listing interest rates for zero deposit and withdrawal, full deposit and withdrawal, and principal and interest withdrawal varieties will remain unchanged, and the listing interest rates for call deposits will remain unchanged.
The latest deposit execution interest rate table obtained by the reporter from a major bank branch shows that from June 8th, the 5-year fixed deposit execution interest rate of the bank will "break 3" and reach 2.9%; The execution interest rate of some medium - and long-term large certificates of deposit has been reduced by 20 basis points. It is worth noting that the specific interest rates implemented by the same bank may vary slightly in different regions, and should be based on the local conditions.
In September last year, some state-owned and joint-stock banks took the lead in lowering the listing interest rates for RMB deposits, followed by some urban commercial banks and rural commercial banks. This time, state-owned banks have once again lowered the listing interest rate for RMB deposits, which is expected to help alleviate the pressure on banks to continuously narrow their net interest margin, and thus contribute to the stability of the financial system; At the same time, the decrease in deposit interest rates will lead to a decrease in the cost of bank funds, which will help accumulate momentum for the further decline of loan quotation rates, thereby benefiting the further reduction of financing costs for enterprises and individuals.
Wang Yifeng, Chief Financial Analyst of Everbright Securities, recently stated that since the beginning of 2023, both corporate and residential deposits have continued to exhibit obvious characteristics of periodization. For top banks, due to a higher proportion of core liabilities, they are more significantly dragged down by the regularization of deposits. The pressure of NIM tightening in the banking system still exists, and the growth rate of net interest income is showing a further downward trend. There is an urgent need for the banking system to further strengthen debt cost control, enhance its risk resistance, and stabilize the level of net interest income.
According to Industrial Research, looking at the several rounds of decline in deposit interest rates since the outbreak of the pandemic in 2020, it can be found that a decrease in deposit interest rates usually requires a weakening of financing demand, a lack of further downward momentum in loan interest rates, or pressure on the net interest margin of commercial banks.
It is worth noting that the cost of long-term deposits is the main target of pressure reduction for this large bank, mainly because the current medium - and long-term deposit interest rates are much higher than the market interest rates of the same period. This reduction is conducive to preventing the problem of fund turnover caused by interest rate inversion. According to the research report of CITIC Securities Bank, it was expected that the bank would lower its deposit interest rate, mainly affecting the long-term deposit interest rate that is higher than the market rate, and further easing the pressure on the bank's debt side. For the entire industry, it is not ruled out that joint-stock banks and urban rural commercial banks will follow up on reducing deposit interest rates based on their own business and supply and demand conditions.
In addition, market analysis suggests that a decrease in deposit interest rates means that there is room for a decrease in LPR. Wang Yifeng recently stated that "further interest rate cuts" for deposits provide a buffer for the LPR quotation reduction, and it is not ruled out that MLF interest rate cuts will be initiated at an appropriate time in the third quarter. "Since the beginning of the year, the self-discipline mechanism has guided commercial banks to implement a series of policies to reduce deposit costs. However, due to the intensification of deposit regularization, the net interest margin pressure on the banking system is still high, and the loan quotation mechanism is not enough to drive commercial banks to voluntarily lower their LPR. If the fixed deposit interest rate is lowered again, it may open a window for the LPR quotation to be lowered."
