At present, the exit of smart notice deposits is accelerating. Bank of Communications, Postal Savings Bank, Industrial Bank, Ping An Bank, Everbright Bank, Bohai Bank, Bank of Changsha and many other banks have recently announced that they will remove smart notice deposits and stop the automatic rollover function.
China Merchants Bank announced on May 14 that due to policy changes and business adjustments, the bank will adjust the smart notice deposit business. Starting from May 15, the bank will stop the smart notice deposit service and handle the business interest settlement.
Image source: China Merchants Bank official website
The reporter learned from a large state-owned bank that, according to the requirements of the management department, the self-discipline requirement for the interest rate of notice deposits and agreement deposits is a transition period of 1 year, and from May 15, 2024, the intelligent notice deposits containing the automatic rollover function will be completely stopped, and the interest rate of all call deposits and agreement deposits (including stock contracts) should be within 10BP (inclusive).
Smart Notice Deposit is delisted
Starting today, Smart Notice Deposits will be fully delisted.
On May 13, the Postal Savings Bank of China announced that from May 15, the stock of personal notice deposits (including Dream Plus Post Station) products that can be automatically rolled over will no longer be automatically rolled, and the maturity date of the call deposit products is the maturity date of the last rollover cycle, and the account will not be automatically closed after expiration.
Image source: Postal Savings Bank official website
On May 10, Bank of Communications announced that it would terminate the Shuangli deposit (ordinary version/super version) business on May 15. According to the relevant regulations, from the date of implementation of the announcement, the Shuangli deposit business agreement signed between the customer and Bank of Communications will be automatically terminated. After the termination of the agreement, Bank of Communications will no longer provide customers with services such as opening Shuangli deposit sub-accounts and depositing transfer funds.
Image source: Bank of Communications official website
On May 8, Ping An Bank announced that it would take the "Daily Generating Gold" and "Smart Deposit-Call Deposit" products offline on May 15 and terminate related businesses. After going offline, customers who have signed up for the "Daily Deposit" and "Smart Deposit-Call Deposit" products will no longer enjoy the services related to the "Daily Money" and "Smart Deposit-Call Deposit" products.
Image source: Ping An Bank's official website
Dong Ximiao, chief researcher of Zhaolian, told reporters that the smart notice deposit is an "upgraded version" of the call deposit, the difference is that the general call deposit requires the depositor to clarify the variety of the call deposit (1 day or 7 days), while the smart notice deposit can be automatically matched to a relatively high deposit interest rate according to the depositor's deposit duration and deposit amount.
It is conducive to reducing the cost of bank liabilities
Talking about the reasons for the removal of smart notice deposits, a number of banks explained in the announcement that in order to implement relevant regulatory requirements and further maintain the order of market competition.
In May 2023, the regulator issued a document to adjust the self-discipline upper limit of the interest rate on agreement deposits and call deposits, with the benchmark interest rate plus 10 basis points for Chinese state-owned banks and 20 basis points for other financial institutions. At the same time, the suspension of intelligent automatic rollover of notice deposits that do not require customer operation, and the stock will naturally expire. The self-regulatory upper limit of the interest rate will be adjusted from May 15, 2023, with a transition period of one year.
In Dong Ximiao's view, although smart notice deposits can improve depositors' returns and attract more depositors' deposits, they will increase the cost of bank liabilities to a certain extent. The removal of smart notice deposits is in line with the policy guidance of reducing deposit interest rates, which is conducive to continuously reducing the cost of bank liabilities and making the real economy more sustainable.
Zhou Maohua, a macro researcher at the financial market department of Everbright Bank, also told reporters that at present, some banks have removed smart notice deposits and adjusted large-amount certificates of deposit, which is beneficial to alleviating the cost of bank liabilities, especially for banks with a high proportion of liabilities in products such as large-amount certificates of deposit and smart notice deposits. In addition, banks will remove or adjust relevant products, which will help maintain the normal competition order of the deposit market and reduce the impact of high-interest deposits.
Industry insiders said that in the past two years, the net interest margin of mainland commercial banks has fallen significantly. In 2024, banks' net interest margins are likely to decline as the comprehensive financing costs of society are steadily reduced. In this context, lowering deposit interest rates and reducing debt costs have become the common choice of commercial banks. In 2024, banks will continue to cut deposit rates to reduce the cost of funds and ease the pressure of narrowing interest rate spreads. Judging from the timing of deposit interest rate cuts, it is expected that in the second and third quarters of this year, the market is likely to usher in a new round of adjustment of deposit interest rates.
Zhou Maohua believes that banks should continue to optimize the asset-liability structure to solve problems such as rising debt costs and net interest margin pressure; Enhance the development capacity of inclusive finance, and increase business expansion in key emerging areas such as weak links in the real economy, science and technology innovation and green; In line with market demand, we will increase the development of wealth management, retail and other businesses, steadily increase the proportion of asset-light and capital-light businesses, enhance customer stickiness, and also facilitate the precipitation of demand deposits and reduce the cost of comprehensive liabilities; Through the application of digital technology, we can improve the efficiency of operation and management and risk capabilities, reduce costs and increase efficiency.
Reviewer: Ye Siqi Editor: Zhang Diange Proofreader: Zhang Lijing Producer: Zhang Nan
Issued by: Fei Yangsheng