China Smaller Banks Cut Deposit Rates to Ease Margin Pressure
- Some banks cut time deposit rates by up to 45 basis points
- Most banks reported deteriorating margins in annual results
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Some smaller Chinese lenders cut interest rates for time deposits over the weekend, following a similar move by their larger rivals last year, after several lending rate reductions by policy makers started to squeeze their margins.
Rural lenders in provinces including Henan and Hubei lowered deposit rates by as much as 45 basis points on some tenors, according to their announcements. After the adjustment, these lenders will pay an annual 1.9% for one-year deposits, down from the previous 2.25%.