On December 18th, Financial Associated Press reported (journalist Shi Sitong), "Large-denomination certificates of deposit are here!" "Limited quota, first come first served" … As the year-end approaches, more and more small and medium-sized Banks are joining the deposit collection battle, continuously launching large-denomination certificates of deposit and special deposit products with "high interest" rates, even raising deposit interest rates against the trend to attract depositors.

Financial Associated Press reporters noticed that with rounds of "interest rate cuts", deposit interest rates at Banks have generally fallen below 2%. However, recently, small and medium-sized Banks have significantly increased their deposit collection efforts, and many Banks have offered deposit products with interest rates exceeding 2%, with some private Banks reaching up to 3%.

According to industry experts, some small and medium-sized Banks are still facing pressure to retain customers and collect deposits, and the aforementioned phase adjustment is mainly a short-term strategy taken to meet deposit collection Indicators, which may experience a decline thereafter. Looking ahead, there is still room for adjustment of deposit interest rates at Banks, and investors need to moderately lower their expected returns on deposit and other financial products.

With interest rates reaching 3%, small and medium-sized Banks are rolling out large-denomination certificates of deposit and specialty deposits as high-interest products.

Specifically, recently, Yidu Rural Commercial Bank has launched a significant deposit product called "New Year’s Red" for 2025. Among them, the three-year special deposit "Full of Good Fortune" (starting from 0.05 million yuan) and "Wealth Preservation" (starting from 0.2 million yuan) both have interest rates reaching 2% and above, specifically 2% and 2.1%. In addition, the one-year "Wealth Preservation" is the main deposit product promoted by the bank this time, with an interest rate of up to 1.75%! Depositing 0.2 million yuan will yield an interest of 800 yuan more than a regular fixed-term deposit.

"Customers who open a Class I Account with us and choose large-denomination certificate of deposit products within 31 days can immediately enjoy new customer benefits!" On the other hand, Guangdong Huaxing Bank recently launched a "New Customer Exclusive" large-denomination certificate of deposit, starting from 0.2 million yuan, with a five-year annualized interest rate reaching 2.5%. Meanwhile, among the ordinary large-denomination certificates of deposit offered by the bank, the interest rates for three-year and five-year terms are both above 2%, specifically 2.45% and 2.4%; additionally, the three-year special deposit product "Emerging Savings" starting from 10,000 yuan can also reach an interest rate of 2.4%.

Financial Associated Press reporters noticed that recently, an increasing number of small and medium-sized Banks have started to ramp up their deposit collection efforts, continuously launching specialty deposits and large-denomination certificates of deposit as "high-interest" deposit products, even raising deposit interest rates against the trend. Among them, many Banks have offered products with interest rates exceeding 2%, with some private Banks even reaching 3%.

Among them, in terms of private banks, for Xinan Bank, the interest rates for six-month to three-year fixed deposits are all above 2%, specifically 2.05% for six months, 2.25% for one year, 2.85% for two years, and 3% for three years. The interest rate for a three-year large time deposit of 0.2 million at Xishang Bank reaches as high as 3%, while the annual interest rates for the two-year, three-year, and five-year fixed deposits starting from 50 yuan at this bank are 2.5%, 2.85%, and 2.6%, respectively.

For urban and rural commercial banks, the current annual interest rates for large time deposits of three years and five years starting from 0.2 million yuan at Ya'an Commercial Bank are both 2.3%, and the annual interest rates for three-year and five-year fixed deposits starting from 50 yuan at this bank are both 2.25%; the three-year special deposit interest rates starting from 0.05 million yuan and 0.3 million yuan at Turpan Rural Credit Union are 2.1% and 2.5%, respectively; the annual interest rate for a three-year large time deposit starting from 0.2 million yuan at Hainan Bank is 2.35%.

At the same time, some major state-owned banks have recently launched a new batch of large time deposits, but the overall interest rate levels are relatively low. For example, Postal Savings Bank Of China recently issued personal large time deposits for the 166th to 171st periods in 2024, with a minimum deposit of 0.2 million yuan. Among them, the one-year annual interest rate is 1.5%, the six-month annual interest rate is 1.35%, and the three-month annual interest rate is 1.15%.

The pressure to attract deposits is quite high, and the short-term strategy sets a solid foundation for the new year’s "good start".

In the view of Su Xiaorui, a senior researcher at Suxihuo Research, as the end of the year approaches, small and medium-sized banks continuously launch large time deposits and special deposits as "high-yield" products, and even take the counterintuitive step of raising deposit rates. On one hand, this is due to the approaching end-of-year point, where small and medium-sized banks hope to attract more new customers and increase their deposit scale for this year, laying a good foundation for the new year's "good start". On the other hand, it reflects the fact that small and medium-sized banks are still facing pressure regarding customer retention and attracting deposits.

She believes that compared to the aforementioned small and medium-sized banks, the deposit products of large state-owned banks and joint-stock banks maintain a relatively low interest rate level, indicating that large banks "do not lack customers" in attracting deposits, the root cause being that large banks have a strong brand effect and a comprehensive online and offline customer acquisition channel.

"The behavior of some small and medium-sized banks in this regard somewhat goes against the overall downward trend of current deposit rates, and may be a short-term strategy taken to meet deposit targets. In the long term, the decline in deposit rates is a significant trend influenced by central bank monetary policy," said Mingming, the chief economist of CITIC SEC, to reporters.

In Mingming's opinion, because small and medium-sized banks have disadvantages in scale, brand influence, and customer base compared to large state-owned banks, they need to offer more attractive interest rates to attract and retain customers. In contrast, large state-owned banks and joint-stock banks have a broader customer base and more stable funding sources, resulting in a relatively lower demand for high-interest deposit attraction. Additionally, large state-owned banks are also stricter in implementing central bank monetary policies.

At the same time, Zhou Maohua, a macro researcher from the Financial Market Department of China Everbright Bank, pointed out that banks need to consider various factors such as supply and demand in the deposit market, liability capacity, and operational conditions when adjusting deposit interest rates.

In his view, generally, small and medium-sized banks tend to have certain gaps compared to large banks in terms of branches, brand, customer base, product service capability, and financing channels, resulting in weaker liability capacity and generally higher deposit rates. However, the specific pricing of deposit interest rates by different banks is also related to their liability capacity, regional advantages, and specific execution prices. The rise in interest rates by a few banks reflects that some banks are working hard to balance liabilities with reducing liability costs.

A subsequent decline may occur, and there is still certain room for lowering deposit interest rates in the future.

However, in Su Xiaorui's opinion, the deposit rates raised at the end of the year and the beginning of the next may see a decline afterward. Meanwhile, Zhou Maohua further pointed out that there is still a certain structural imbalance in the current deposit market, leaving room for banks to lower deposit interest rates. However, the constraints on lowering the deposit rates are also evident, mainly because further reductions in deposit rates lead to a decline in the cost-performance ratio of deposit products, with some banks facing the risk of losing deposits.

Looking ahead, Ming Ming believes that the overall trend of deposit interest rates may continue to decline. Under moderately loose monetary policies, reserve requirement ratio and interest rate cuts will continue to lower the financing cost for the real economy. At the same time, recently, the bond market interest rates have been declining rapidly, which may face certain adjustments, but the overall trend remains unchanged.

In this context, Ming Ming suggests that small and medium-sized banks should, firstly, improve operational efficiency and optimize customer service experience through the introduction of advanced CNI Xiangmi Lake Fintech Index, thereby reducing costs; secondly, closely monitor fluctuations in market interest rates and policy changes to flexibly adjust the asset-liability structure; thirdly, develop customized financial products to meet the needs of different customer groups and enhance customer loyalty; and fourthly, leverage their flexibility and local characteristics to provide more personalized and differentiated services to attract specific customer groups.

At the same time, Su Xiaorui also pointed out that under the environment of continuously declining interest rates, small and medium-sized banks need to manage their liabilities well based on their circumstances while adhering to their positioning in supporting agriculture and small businesses. Additionally, they need to follow the current trend of digital transformation, applying technology to enhance the quality and efficiency of customer group exploration and management, building online channels while integrating comprehensive service content across all scenarios, and continuously improving the digital financial service ecosystem.

Next, small and medium-sized banks must continuously improve internal governance, enhance risk management capabilities, effectively implement macro policies, and strengthen the service capabilities centered around enhancing the real economy. In Zhou Maohua's view, some small and medium-sized regional banks should fully exploit the advantages of index locations, deeply cultivate regional economies, enhance operational efficiency and risk control capabilities while improving service capabilities for the real economy; on the other hand, they should actively promote retail business and light capital business development, broaden financing channels, and enhance liability capacity.

In addition, from the perspective of investors, Zhou Maohua further suggests that depositors need to moderately lower their expectations for the returns on deposits and other financial products. On one hand, it is necessary to avoid potential losses caused by excessive risk-taking; on the other hand, with the steady recovery of the economy and the easing of financial market sentiments, investors can moderately diversify their asset allocation to balance the relationship between returns and risks.