21st Century Business Herald Reporter Ye Maisui
At the beginning of the second quarter, multiple banks announced that they would lower the listed interest rates for certain term deposits starting from April 1. This round of adjustments almost covers all long, medium, and short-term varieties, with some banks even lowering the rates of certain products twice within a week.
Some analysts believe that the frequent reductions in deposit rates by banks are mainly influenced by the continued low net interest margin. According to the recently released annual reports of banks, the net interest margin of the six major banks still showed a downward trend last year.
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Multiple banks lower deposit rates
Xiamen Bank announced on March 31 that starting from April 1, it would lower the listed interest rates for personal one-day and seven-day notice deposits by 5 basis points each, to an annualized 0.6% and 0.9%, respectively. At the same time, the reductions for corporate notice deposits for one-day and seven-day terms were even larger, with decreases of 30 basis points and 35 basis points, bringing them down to an annualized 0.35% and 0.6%.
In fact, the bank had already lowered its deposit rates once before. On March 27, Xiamen Bank reduced the listed interest rates for personal one-year, three-year, five-year, and one-day notice deposits by 10 basis points, 20 basis points, 20 basis points, and 5 basis points, respectively. With this adjustment, the interest rates for the bank's deposit products have nearly all been lowered. Notably, the listed interest rate for personal one-day notice deposits was reduced twice within less than a week, totaling a decrease of 10 basis points.
Fujian Strait Bank also recently announced that starting from March 27, it would adjust the listed interest rates for agreed deposits and one-day notice deposits, and from April 1, it would adjust the listed interest rates for seven-day notice deposits, while other term rates would remain unchanged. After the adjustments, the listed interest rates for agreed deposits, one-day, and seven-day notice deposits were lowered by 5 basis points, 10 basis points, and 20 basis points, respectively, compared to early January this year.
Jilin Bank announced on April 1 that it would adjust the listed interest rates for RMB deposits, specifically for three-year fixed-term deposit products, lowering the rate from an annualized 1.75% to 1.70%, a decrease of 5 basis points. After the adjustment, the interest rate inversion between the three-year and five-year fixed deposits was narrowed from 15 basis points to 10 basis points.
Additionally, Xishang Bank stated that starting from April 1, it would adjust the deposit rates for certain mobile banking products, with the three-year and five-year fixed deposit rates both adjusted to 1.8%, a reduction of 20 basis points compared to the current rates.
Jiangsu Nanjing Pukou Jingfa Village Bank took action even earlier, having lowered deposit rates twice since March. On March 9, the bank adjusted the one-year deposit rate from 1.85% to 1.65% and the two-year deposit rate from 1.8% to 1.65%; on March 20, the bank further lowered the one-year deposit rate to 1.5% and the two-year deposit rate to 1.47%.
Moreover, Shandong Chiping Hu Nong Shang Village Bank, Yunnan Yuanjiang Beiyin Village Bank, Xinjiang Bank, Shanghai Songjiang Fuming Village Bank, Heilongjiang Youyi Rural Commercial Bank, and others all lowered their listed deposit rates in March, primarily targeting long-term fixed deposits, with reductions ranging from 5 basis points to 30 basis points
From the perspective of the adjustment range, this adjustment basically encompasses all periods, but the adjustment of long-term interest rates is more pronounced. Several banks have significantly lowered the interest rates for 3-year and 5-year deposits, and some banks have seen their deposit rates for different terms basically level off or even invert, meaning that long-term deposit rates are lower than short-term deposit rates.
Regarding the concentrated reduction in short-term deposit product rates, industry insiders generally believe that this reflects the banks' renewed focus on managing liability costs after the &#34;New Year&#34; sprint.
Wang Pengbo, chief analyst at Broadcom Consulting, stated that with the end of the &#34;New Year&#34; period, the industry needs to refocus on managing liability costs. Therefore, banks are choosing to actively reduce deposit costs and optimize term structures. In the future, more banks may follow suit to rebalance deposit rates.
The net interest margin of the six major banks is still declining
Behind the reduction in deposit rates is the pressure of banks' net interest margins continuing to hover at low levels.
Recently, the National Financial Regulatory Administration released the main regulatory indicators for commercial banks for 2025, showing that by the end of the fourth quarter of 2025, the net interest margin of commercial banks remained at 1.42%, unchanged from the end of the third quarter, stabilizing at this level for three consecutive quarters, ending the previous years of unilateral decline.
From the perspective of different types of banks, the industry’s interest margins show a differentiated characteristic, with small and medium-sized banks performing relatively steadily: by the end of the year, the net interest margins of large commercial banks, joint-stock banks, city commercial banks, and rural commercial banks were 1.30%, 1.56%, 1.37%, and 1.60%, respectively. Among them, rural commercial banks rebounded by 2 basis points compared to the end of the third quarter, joint-stock banks and city commercial banks remained the same as the third quarter, and large commercial banks slightly decreased by 1 basis point, while foreign banks' net interest margins decreased by 0.03 percentage points compared to the end of the third quarter.
Liu Feipeng, a researcher at China Postal Savings Bank, analyzed that the pressure of narrowing net interest margins and the continuous decline in loan rates compel the banking industry to carry out refined liability management, that is, to guide funds to shift towards the medium and short term through interest rate inversion. At the same time, this marks an acceleration in the marketization process of deposit rates, with small and medium-sized banks shifting from extensive deposit gathering to differentiated competition. So far, this has achieved certain results.
From the recently disclosed financial reports, the six major banks achieved &#34;double positive growth&#34; in operating income and net profit for 2025, but under the influence of factors such as the reduction in the Loan Prime Rate (LPR), the repricing of existing loans, and intensified deposit competition, the net interest margins of the six major banks are still on a downward trend.
Specifically, Postal Savings Bank still maintains a relative advantage, with a net interest margin of 1.66%, ranking first among the six major banks; China Construction Bank's net interest margin is 1.34%, while the net interest margins of the other banks are generally below 1.3%, specifically Agricultural Bank of China 1.28%, Industrial and Commercial Bank of China 1.28%, Bank of China 1.26%, and Bank of Communications 1.20%.
In terms of the decline, the net interest margins of the six banks have all decreased compared to 2024, with Bank of Communications narrowing by 7 basis points, the smallest decline. It is noteworthy that although it is still narrowing, compared to the year-on-year decline in 2024, the overall decline in the net interest margins of the six major banks in 2025 has tended to converge. Among them, the decline in the net interest margins of Bank of China and Industrial and Commercial Bank of China was 5 basis points less than the decline in 2024; Agricultural Bank of China and China Construction Bank were 4 basis points and 2 basis points less than the decline in 2024, respectively
In fact, starting from the second half of 2025, the market has certain expectations for the stabilization of the net interest margin of the six major banks. Based on the year-end data, the net interest margins of Industrial and Commercial Bank of China and Bank of Communications are both flat compared to the end of the third quarter of 2025, while the decline in the net interest margins of China Construction Bank and Postal Savings Bank at the end of 2025 is also controlled within 0.01 to 0.02 percentage points compared to the decline at the end of the third quarter of 2025, indicating clearer signs of stabilization on a quarter-on-quarter basis.
However, regarding the issue of net interest margins, most analysts believe that it has already bottomed out, and there is a high possibility of improvement in the future. According to calculations by Liu Chengxiang, an analyst at Kaiyuan Securities, if the central bank reduces the reserve requirement ratio by 50 basis points in the first quarter of this year, it would boost the net interest margin of listed banks by 0.46 basis points in 2026, with state-owned banks / joint-stock banks / city commercial banks / rural commercial banks at 0.42BP / 0.54BP / 0.54BP / 0.60BP respectively.
In addition, the scale of maturing resident time deposits of commercial banks in 2026 is approximately 47 trillion to 54 trillion yuan, of which the scale of high-interest time deposits maturing in 2 years or more is about 25 trillion to 29 trillion yuan. For time deposits that are repriced in the first quarter, the declines for state-owned banks are 15BP, 60BP, 135BP, and 145BP for one year, two years, three years, and five years respectively, which could also improve the net interest margin of listed banks by 10BP in 2026

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Multiple banks have lowered the listed interest rates for certain term deposits starting from April 1, covering long, medium, and short-term varieties, with some banks even making two adjustments within a week. Analysts believe that the frequent reductions in deposit rates are due to banks' net interest margins remaining at low levels. Xiamen Bank, Fujian Haixia Bank, Jilin Bank, and several other banks have announced adjustments to their deposit rates, with changes ranging from 5 basis points to 35 basis points

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Deposit rates have dropped again! After the "New Year Opening Red," banks focus on managing liability costs