In order to retain the existing customers who had previously deposited on third-party Internet platforms, private banks have made "new moves" to attract deposits. An investigation by a reporter from Beijing Business Daily found that recently, Liaoning Zhenxing Bank launched a "relocation gift" activity to launch deposit conversion products for customers who have purchased the bank's deposit certificates on third-party Internet platforms and have not yet matured. Customers can participate in this activity through the App of Liaoning Zhenxing Bank, and can directly convert the original certificates of deposit that have not yet matured to the new certificates of deposit of the bank with a term of 3 years.
However, an investigation by a reporter from Beijing Business Daily found that although the comprehensive interest rate of the new certificate of deposit is 4.5%, the interest rate of 2.45% is not distributed by the bank, but from Beijing Nike Matrix Technology Co., Ltd. (hereinafter referred to as "Nick Matrix"). In addition to the 4.5% comprehensive income, if the customer transfers all the certificates of deposit held by the customer, he can also get a JD e-card with a face value ranging from 20 to 500 yuan.
In the context of the continuous decline in deposit interest rates and the difficulty of finding products above 3%, Liaoning Zhenxing Bank's "relocation and courtesy" activity has attracted market attention. Many customers are considering depositing after learning about this event, while many more customers are hesitant or choose to forgo deposit due to concerns about potential risks......
Dual-interest rate rollover products
"The deposit of the Internet platform is about to expire, the deposit interest rate in the market is getting lower day by day, I don't want the assets to shrink, and I want the funds to be safe, and I want to make considerable returns? to revitalize, and customize the deposit products for you to go home...... Beijing Business Daily reporter found that recently, Liaoning Zhenxing Bank launched the "Relocation Gift" activity, and launched deposit conversion products for customers who have purchased the bank's deposit certificates on third-party Internet platforms and have not yet expired.
Photo courtesy of the interviewee
According to the introduction of the event, customers who hold certificates of deposit that are about to expire on the third-party Internet platform, such as smart deposits, Zhenxiang deposits, and e-deposits, can directly transfer the original certificates of deposit to the bank's new certificates of deposit with a term of 3 years by participating in this activity on the App of Liaoning Zhenxing Bank. The composite interest rate of the new certificate of deposit is 4.5%, of which 2.05% is the product interest rate and the other 2.45% is the event reward. In addition to the 4.5% comprehensive income, if the customer transfers all the certificates of deposit held by the customer, he can also get a JD e-card with a face value ranging from 20 to 500 yuan. The campaign will end on December 31.
"I have deposited our bank's deposit on other platforms before, and the deposit has not yet expired, participate in this activity, the previous deposit certificate is equivalent to early withdrawal invalidation, and a new certificate of deposit will be formed, with an interest rate of 4.5%, 3 years, and monthly interest, which can be participated in in the Liaoning Zhenxing Bank App, and all deposits on other platforms can be transferred to get JD e-card rewards. Liaoning Zhenxing Bank customer service staff introduced.
According to the official website of Liaoning Zhenxing Bank, the bank has adjusted the deposit interest rate since May 15, and the listed interest rate of the 3-year time deposit has been reduced from 3.712% to 3.5%, and the adjusted 5-year time deposit interest rate is 4%. What are the considerations behind the launch of this activity by Liaoning Zhenxing Bank? In this regard, a reporter from Beijing Business Daily contacted Liaoning Zhenxing Bank for an interview, but has not received a reply as of press time.
Su Xiaorui, a senior observer of the banking industry, pointed out that Liaoning Zhenxing Bank launched the "relocation courtesy" activity to convert the original deposit certificates of existing depositors into 3-year deposit products, on the one hand, it aims to retain old customers through its own platform, on the other hand, the previous Internet deposits are more flexible and can be withdrawn in advance without damaging more interest.
A third party that pays a portion of the interest rate
While it is understandable to launch new products to retain existing customers, it is doubtful that the majority of interest rates on new CDs are paid by third parties. The customer service staff of Liaoning Zhenxing Bank said that the comprehensive interest rate of 4.5% of the new certificates of deposit, of which 2.05% of the deposit interest rate was distributed by the bank, and 2.45% of the activity rewards were distributed by the cooperative platform Fangnik Matrix. The intelligent customer service of Liaoning Zhenxing Bank App also introduced that the reward part of the "Relocation Gift" activity can contact the partner Nick Matrix for consultation.
"The reward part of the event is distributed by us, and after the transfer is successful, you can check the amount of the Nick part of the help income at any time on the deposit receipt page. According to the customer service staff of Nickelodeon Matrix, the interest rate of the new certificate of deposit activity is also distributed to the customer's electronic account on a monthly basis in the form of cash, and the deposit interest rate and activity reward will be paid separately on a monthly basis. "Because the interest rate is relatively high, the maximum amount of redeposit is the amount of the original certificate of deposit, and new deposits are not supported," the customer service staff added.
Photo courtesy of the interviewee
In addition to the activity reward income, the above-mentioned Nick Matrix customer service staff also introduced that customers can also get the corresponding amount of JD e card rewards if they relocate and transfer all the deposit receipts of the previous Internet platform: less than 50,000 yuan can get 20 yuan JD e card, 50,000-100,000 yuan get 50 yuan JD e card, 100,000-200,000 yuan is 100 yuan JD e card, 200,000-500,000 yuan is 200 yuan JD e card, and more than 500,000 yuan is 500 yuan JD e card.
Why is the deposit activity of Liaoning Zhenxing Bank distributed by a third party to distribute interest rewards?Nick Matrix customer service staff said: "We are the operation and cooperation service provider of Liaoning Zhenxing Bank, and we are responsible for the points and other activities carried out by mobile banking. ”
It is understood that Nick Matrix was established in September 2018 and is a wholly-owned subsidiary of Beijing Kelan Software System Co., Ltd. (hereinafter referred to as "Kelan Software"), a listed company. Nickelodeon Matrix mainly provides financial Internet marketing platform and operation services. According to the official website of Nickelodeon Matrix, the company's partners include private banks such as Liaoning Zhenxing Bank, Zhongbang Bank, Merchant Bank, Xinwang Bank, Hunan Sanxiang Bank, and local city commercial banks such as Tailong Bank and Bank of Nanjing.
Beijing Business Daily reporter noticed that Nick Matrix has long-term cooperation with Liaoning Zhenxing Bank, and some customers have previously reported that the Nick Matrix helped the income not to be accounted for on the Liaoning Zhenxing Bank post bar, but a day later, it was reported that the income had been issued on the same day, and it was only late to the account.
According to the Notice on Matters Concerning the Improvement of the Management of Deposit Deviation of Commercial Banks, banks are not allowed to absorb deposits with rebates in violation of regulations, and to absorb deposits by improper means such as returning cash or negotiable securities, giving away physical goods, etc. Wang Deyue, a lawyer at Beijing Xunzhen Law Firm, believes that the regulatory authorities clearly stipulate that banks are not allowed to engage in high-interest or disguised high-interest solicitation of deposits. Liaoning Zhenxing Bank's method of paying interest on activity rewards and giving JD e-cards through third-party companies is also to avoid being identified as "high-interest savings", so as to avoid being hit by regulators.
The tangle of risk and return
The user groups targeted by Liaoning Zhenxing Bank's "Relocation and Courtesy" activity are the existing customers in the years when Internet deposits were "popular". At that time, local banks and private banks used the Internet platform to collect deposits across regions, and the deposit products jointly launched by them once became a powerful tool for such banks by virtue of many advantages such as high interest rates, low thresholds, flexibility, and interest calculation by file.
However, the deposits of some banks' Internet platforms have grown rapidly, the scale is relatively high, and the deposit structure has changed greatly; local corporate banks have broken through geographical restrictions and expanded their deposit business to the whole country; and it is very easy to lead to risks such as "deposit relocation", prompting the regulators to take action to rectify. In January 2021, the Notice on Matters Concerning the Regulation of Commercial Banks Conducting Personal Deposit Business through the Internet (hereinafter referred to as the "Notice") was issued. Since then, the "interest calculation by file" and the Internet deposit of the third-party platform have pressed the "terminate button". However, before the issuance of the Circular, the existing business already carried out by commercial banks could be settled naturally upon maturity.
Before the suspension of the third-party Internet deposit platform, Liaoning Zhenxing Bank had cooperated with a number of Internet platforms, and many customers had purchased the bank's deposit products on the relevant platforms. A source familiar with the Internet platform that cooperates with Liaoning Zhenxing Bank revealed that since the suspension of Internet deposits, the platform has no cooperation with Liaoning Zhenxing Bank, and it is not aware of the activity launched by the bank.
A reporter from Beijing Business Daily learned that a number of Liaoning Zhenxing Bank's certificate of deposit customers who hold third-party Internet platforms have recently received text messages from Liaoning Zhenxing Bank's "relocation courtesy" activity. The content shows that "one-click conversion of new products locks in 4.5% annualized income in the next 3 years in advance (deposit interest rate of 2.05% + activity reward of 2.45%), and there is a limited gift of up to 500 yuan JD e-card! Details can be queried on the deposit page of Liaoning Zhenxing Bank App, or consult the mobile banking 'intelligent customer service'". The reporter learned that most of these depositors are users who purchased Liaoning Zhenxing Bank's deposit products on the Internet platform from 2019 to 2020.
In the context of the continuous decline in deposit interest rates and the difficulty of finding products above 3%, Liaoning Zhenxing Bank's "relocation and courtesy" activity has attracted market attention. Many customers are considering depositing after learning about this event, "I have received a text message before, and I plan to move at the end of the month," said depositor Wang Lihua (pseudonym).
More customers are hesitant or choose to forgo deposits due to concerns about potential risks. "The interest rate of my original certificate of deposit is 4.3%, and I will not transfer it after thinking about it, and 2.45% is a reward attribute, in case of an accident, it can be weaker than the regular interest recourse. Depositor Yang Jun (pseudonym) said.
Beijing Business Daily reporter consulted Liaoning Zhenxing Bank App intelligent customer service and learned that this activity can transfer all or part of the principal, after participating in the activity for deposit conversion, the original certificate of deposit is equivalent to making the corresponding amount of early withdrawal, and the interest will be settled according to the interest rate of each period from the previous interest settlement to the current day. The new CD with a term of 3 years after the rollover will pay dividends on a monthly basis, and partial withdrawal in advance is not supported, and all can be withdrawn in advance, but the interest paid on the product needs to be deducted, and the distributed activity rewards will not be recovered. The customer service staff of Liaoning Zhenxing Bank explained that the early withdrawal of the original certificate of deposit will be settled according to the dividend interest rate of the actual deposit days, but the 3-year new certificate of deposit after the transfer can only be fully withdrawn, and the withdrawal will be calculated according to the current interest rate of 0.35%, because the interest is paid once a month, so the product interest issued according to 2.05% needs to be deducted, but the 2.45% activity reward part that has been issued will not be recovered.
"In case of early withdrawal after the transfer, the interest paid will be reversed, and the original certificate of deposit does not seem to be reversed", Yang Jun believes that Liaoning Zhenxing Bank should want to "lock" customer funds through the "relocation courtesy" activity.
Regarding the risks in the transfer process that customers are worried about, the customer service staff of Liaoning Zhenxing Bank only said that the Nickelodeon Matrix is the bank's cooperation platform, and "if you are worried about risks, you can not participate".
Wang Deyue said that there may be interest rate risk and credit risk in the process of Liaoning Zhenxing Bank's "relocation and courtesy" activity, and if the comprehensive interest rate of the transferred account or product is lower than the original deposit interest rate, depositors may lose part of the interest income, and at the same time, if the bank or third-party company has credit problems, it may affect the deposit safety and income of depositors. Depositors are advised to read the relevant terms and conditions carefully before participating in the rollover activity, understand the risks and benefits of the rollover process, and make decisions based on their own risk tolerance and capital needs.
Innovative deposits still need to be moderate
Since the beginning of this year, deposit interest rates have undergone several adjustments, and it has become a regular rhythm for large banks to take the lead, joint-stock banks to follow quickly, and local banks to follow one after another. However, for some local banks and private banks, the pressure of narrowing interest rate spreads, how to balance and choose between deposit scale and deposit structure is one of the difficult problems.
According to the data, Liaoning Zhenxing Bank is one of the 19 private banks in mainland China, which opened in November 2017 and is the first private bank in Liaoning Province. According to the annual report of Liaoning Zhenxing Bank, in 2021 and 2022, the bank's customer deposits showed a year-on-year downward trend, of which the bank's total customer deposits in 2022 were 20.351 billion yuan, a year-on-year decrease of 1.87%. In 2023, the bank's customer deposits rebounded, and from January to September, the bank's customer deposits were 22.332 billion yuan, an increase of 13.07% over the same period last year.
Wang Deyue believes that Liaoning Zhenxing Bank launched the "relocation courtesy" activity, First, in order to accomplish the task of depositing, depositors have relocated to deposit certificates of deposit, which in fact has extended the term of deposits and expanded the scale of bank funds; second, it is necessary to enhance market competitiveness, and by introducing attractive deposit products, banks can enhance their competitiveness in the market and attract more depositors; third, to reduce liquidity risks, by providing three-year deposit products, banks can attract depositors to turn short-term funds into long-term funds, thereby stabilizing the source of funds and improving the efficiency of capital utilization; and finally, it is necessary to readjust the business structure, and banks will increase the proportion of medium- and long-term loan business through the method of rollover, so as to optimize the structure of assets and liabilities。
In order to retain the existing customers of the third-party Internet platform, a reporter from Beijing Business Daily previously investigated and found that Yealink Bank, another private bank, had also launched a "one-click rollover" activity to encourage customers to transfer the assets of Yealink Bank held on the Internet platform to the bank's self-operated platform.
As for how to retain customers and improve the stability of deposits in the follow-up private banks, Pan Helin, co-director and researcher of the Digital Economy and Financial Innovation Research Center of the International Business School of Zhejiang University, said that depositors are now more concerned about the soundness of banks, and large banks perform better in soundness.
Su Xiaorui suggested that private banks need to continuously replenish and enrich diversified capital sources and optimize their capital structure, and at the same time, they need to strengthen the refined operation of customers and enhance their independence by cultivating customer acquisition and operation capabilities. In addition, it is necessary to do a good job in the functional design and user experience of various online businesses.
Beijing Business Daily Financial Investigation Team