Multiple small and medium-sized banks cut interest rates, mainly targeting their high-cost products.

Securities Times reporter Lin Yu

At the beginning of April, several small and midsize banks announced a cut to their deposit benchmark (posted) interest rates. The reduction ranges from 5 to 30 basis points.

Xiamen Bank said in an announcement that, effective April 1, the posted interest rates of multiple deposit products will be adjusted. After the adjustment, the annualized interest rates for one-year, three-year, and five-year fixed deposits will be 1.2%, 1.4%, and 1.4%, respectively, which represent decreases of 10, 20, and 20 basis points compared with before the adjustment. Meanwhile, the bank also notified that the annualized interest rate for its deposits (one day) has been lowered by 5 basis points to 0.65%.

Jilin Bank lowered the posted interest rate of only one fixed-deposit product. Effective April 1, the annualized interest rate for its three-year fixed deposits with deposit-and-withdrawal in a lump sum was lowered from 1.75% to 1.7%, a reduction of 5 basis points. However, there remains a 10-basis-point “inversion” compared with the bank’s five-year fixed-deposit annualized interest rate of 1.6%.

Fujian Strait Bank, on the other hand, adjusted the posted interest rates for Renminbi call deposits and notice deposits. Starting April 1, the call deposit rate (in Fujian Province) was lowered by 5 basis points to 0.6%; the one-day and seven-day notice deposit rates (in Fujian Province) were lowered by 10 and 20 basis points to 0.6% and 0.9%, respectively.

In addition to city commercial banks, several rural commercial banks and township banks have also joined this round of rate cuts, including Hubei Jingling Rural Commercial Bank, Jilin Hunjiang Rural Commercial Bank, and Huixian Zhujing Township Bank, among others.

Among them, Huixian Zhujing Township Bank lowered the interest rates for one-year, two-year, three-year, and five-year term deposits. Taking the one-year product as an example: before the adjustment, the annualized rate for deposits of less than 10,000 yuan was 1.36%, and for deposits of more than 10,000 yuan it was 1.51%. After the adjustment, both become 1.21%, with the largest reduction reaching 30 basis points.

“Once the ‘Open-Door Red’ campaign ends, the banking industry needs to refocus on liability-cost management and control. At this time, choosing to lower deposit interest rates can reduce deposit costs and optimize the liability maturity structure.” Wang Pengbo, chief analyst at Boto n Consulting, told Securities Times reporter Lin Yu.

Zenglian’s chief economist and deputy director of the Shanghai Finance and Development Laboratory, Dong Shimiao, also noted that, to absorb deposits and stabilize liabilities, small and midsize banks may raise deposit interest rates in phases at key time points such as the “Open-Door Red” period, in order to attract new funds and retain existing customers. This is also a direct way to respond to deposit competition and complete performance evaluations.

Judging from the annual reports recently released by multiple listed banks, liability-cost management and control has become a key measure for the industry to “stabilize the interest rate spread.” It effectively helped prevent the decline in the spread from continuing. A research report released by Ma Tingting’s team at Guotai Huarong Securities pointed out that, benefiting from a narrowing in the interest-rate spread decline and a rebound in fee and commission income, the growth rate of listed banks’ performance in 2025 showed marginal improvement.

Taking China CITIC Bank as an example: at a performance meeting, the bank’s chairman Fang Yingying said, “Liability business volume-and-price balanced management is a major operational highlight in 2025. It helps us truly build a ‘wide buffer zone’ that cushions the impact of a low-interest-rate spread shock.”

He also mentioned that, in 2025, China CITIC Bank’s “control of high-cost liabilities” is even more forceful and effective. The combined proportion of three-year deposits, structured deposits, and protocol deposits is below 32%, which, through a relatively reasonable liability structure, brings a clear advantage in funding costs.

This round of small and midsize banks lowering deposit interest rates is also focused on high-cost products such as three-year and five-year deposits and call deposits (protocol deposits). “After this, we expect more small and midsize banks to follow suit in lowering the annualized interest rates of high-cost deposit products.” Wang Pengbo said.

Dong Shimiao believes that for banks to achieve long-term sound and steady development, the core lies in strategically breaking the path dependence on short-term scale-chasing. And by reforming incentive-and-constraint mechanisms to transmit this strategy to the grassroots level, turning the “Open-Door Red” campaign from a short-term marketing campaign into a natural starting point for banks to serve customers throughout the year and create value—ultimately achieving dynamic balance among scale, efficiency, and quality.