At the beginning of April, the wind of banks lowering deposit interest rates blew again! This time it involved small and medium-sized banks from Henan, Shaanxi, Shanxi, Yunnan, and other places.
According to incomplete statistics from China Fund News, deposit rates have been lowered by 5 basis points to 45 basis points. From the perspective of the industry, the reduction of deposit interest rates by regional banks in many places is still a continuation of the third round of deposit rate cuts by commercial banks in 2023. Under the pressure of further compression of bank deposit and loan spreads, national banks may start a new wave of deposit interest rate cuts in the first half of the year.
In a word: the downward trend of deposit rates is still not over!
一降降再降
The relay race of large banks, small and medium-sized banks to cut interest rates is in full swing. The trend of large banks leading and small and medium-sized banks following up may continue.
Judging from the results of recent interest rate cuts, there are still differences in interest rates between banks in different regions and banks of different sizes, but this difference is almost below 1%.
According to the Shanghai Securities News, Daixian Hongdu Village Bank issued an announcement on adjusting some time deposit interest rates, showing that the bank's one-year, three-year and five-year deposit interest rates were 2.05%, 2.95% and 3.0% respectively from April 1, of which the three-year and five-year deposit interest rates were reduced by 35 basis points and 40 basis points respectively.
The interest rates on three-month, six-month, one-year, two-year, three-year and five-year fixed deposits of Xincai Rural Commercial Bank, Suiping Rural Commercial Bank and Xiping Rural Commercial Bank were adjusted to 1.4%, 1.65%, 1.8%, 2.0%, 2.35% and 2.4% respectively.
Since 2022, deposits have become the only consensus and the last recognized safe haven in the market.
According to the 2023 Financial Statistics Report released by the central bank, at the end of December, the balance of domestic and foreign currency deposits was 289.91 trillion yuan, a year-on-year increase of 9.6%. The balance of RMB deposits was 284.26 trillion yuan, a year-on-year increase of 10%. For the whole year of 2023, RMB deposits increased by 25.74 trillion yuan.
Since the implementation of the rigid payment of financial management, unstable returns and the cautious expectations of residents in the future have driven them to tend to save money. In addition, with the poor information and the difference in inter-bank deposit interest rates, the spectacle of cross-provincial "deposit special forces" has been staged one after another, and even the same bank has different listed interest rates in different regions.
In explaining this phenomenon, Jinguan News quoted Dong Ximiao, chief researcher of Zhaolian Financial, as pointing out that, firstly, the margin and upper limit of the deposit increase agreed upon by the self-discipline pricing mechanism of market interest rates in different regions may be different; second, the supply and demand relationship of the deposit market in different regions is different, and the investment preferences and savings habits of customers are different, which affects the pricing of deposit interest rates; and finally, there are differences in the assets and liabilities and market competition strategies of different branches of the same bank, and the demand for deposits and pricing are naturally not completely consistent.
Regardless of whether it is a large bank or a small and medium-sized bank, the continuous reduction of deposit and loan interest rates is aimed at smoothing out two differences: the difference in deposit interest rates between banks, and the inversion of deposit and loan interest rates within banks.
According to Peninsula All Media, a staff member of a joint-stock bank said in an interview with reporters that there are differences in the interest rates of deposit and loan products between large banks and small and medium-sized banks, among which the deposit interest rates of small and medium-sized banks are generally high, while the interest rates of loan products of some banks are relatively low. Under the current counter-cyclical control policy, bank credit interest rates have gradually decreased, but the decline in deposit interest rates of some small and medium-sized banks has been relatively limited. As a result, the interest rate of some deposit products may exceed the interest rate of loan products, resulting in an inversion of the interest rate of deposit and loan products.
Nowadays, the decline in interest rates of small and medium-sized banks is not completely necessary to keep up with the pace of large banks, at least it shows that there is no shortage of deposit indicators for small and medium-sized banks at present.
Adjust the structure, the top priority
Since last year, restructuring has become an important proposition in the bank's business, and this structure should not only ensure the profitability of the bank itself, but also cooperate with the country's policy guidelines.
According to the Financial Times, Zhang Jinliang, chairman of CCB, said at the results conference held on April 2 that "focusing on the main responsibilities and main businesses, comprehensively improving quality and efficiency" is a high-level summary of CCB's work in the past year. In 2023, CCB will adhere to the path of connotative development, take the initiative to adjust its structure, break the cult of scale, and invest more funds in the real economy.
"In the new year, in the face of the business environment where strategic opportunities and risks and challenges coexist, we will adhere to quality first and efficiency first, put structural adjustment and quality and efficiency improvement in a more important position, and unswervingly promote connotative development. ”
The narrowing of net interest margins brought about by the continuous growth of depositors' deposits has been the biggest headache for banks in the past year or so, and the direct reduction of deposit rates is the most direct embodiment, but with little effect. After all, lowering the interest rate on deposits will not solve the dilemma of having nowhere to go for money.
According to the data disclosed by the State Administration of Financial Supervision and Administration, as of the end of 2023, the net interest margin of important indicators of commercial banks fell to 1.69%, falling below the 1.7% mark for the first time, and breaking through the threshold of 1.8% for the consensus net interest margin of the self-regulatory mechanism in the Implementation Measures for Qualified Prudential Assessment (2023 Revised Edition).
Judging from the performance of China Merchants Bank, the king of retail, according to its financial report, although its profit has a single-digit growth, China Merchants Bank achieved revenue of 339.123 billion yuan for the whole year, a year-on-year decrease of 1.64%, and the direct reason for the decline in its revenue is the decrease in net interest margin. In 2023, CMB's net interest margin will be 2.15%, down 25 basis points year-on-year.
When attributing the decline in interest margins, the annual report of China Merchants Bank shows that on the asset side, the LPR continued to decline, and the effective credit demand was insufficient, resulting in a downward trend in the pricing of new loans, driving the average loan yield to decline year-on-year. In addition, residents' willingness to consume and buy houses needs to recover further, and the growth of credit card loans and personal housing loans with relatively high yields is sluggish. On the liability side, the wealth attribute of savings deposits has strengthened, the proportion of deposits in demand has decreased, and the debt cost ratio has increased.
According to reports, Wang Liang, president of China Merchants Bank, once said at the 22nd annual performance meeting that the challenge in 2023 is operating income, and to make up for the gap in operating income in 2023, one is to rely on business increments, and the other is to rely on non-interest business. According to the latest financial report, China Merchants Bank's large wealth management revenue in 2023 will be 45.268 billion yuan, a year-on-year decrease of 7.9%.
In order to stabilize the asset-liability structure and interest rate spread, in addition to lowering the deposit interest rate, Liu Yinping, a researcher at the Rong 360 Digital Technology Research Institute, gave the following ways: one is to continue to strengthen the volume and price control of high-cost deposits to cope with the rising pressure on deposit costs; the second is to expand the scale of customer groups, increase the operation of existing customers, and expand the source of funds; the third is to improve products and services, increase the share of settlement deposits, broaden the sources of low-cost settlement deposits, increase the proportion of demand deposits, and promote the high-quality growth of deposits.
epilogue
The view that banks continue to cut interest rates is still the mainstream!
Dong Ximiao, chief researcher of Zhaolian Financial, told the Financial Times that the Central Economic Work Conference pointed out that "to promote the steady decline of social comprehensive financing costs", in this context, it is expected that the next stage with the reduction of bank capital costs, deposit interest rates are more likely to fall.
China Fund News quoted the judgment of CITIC Securities, pointing out that considering that there will be adjustments in April 2022 and 2023, it is not even ruled out that the deposit rate will be lowered in April this year. In addition to the exemplary role of major banks in further lowering the listed interest rates of deposits, it may also be to control the issuance scale or pricing level of some special deposit products.
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