Chinese Banks Mull Further Deposit Rate Cuts to Ease Margin Pressures

China’s biggest lenders are considering cutting interest rates paid on deposits for the second time in less than a year to bolster the economy while easing pressure on profits, Caixin learned from industry sources.

Large state-owned banks may lower rates paid for on-demand deposits by 5 basis points, or 0.05 of a percentage point, and for three- and five-year time deposits by 10 to 15 basis points, people familiar with the matter said. Big lenders currently offer annualized rates of 0.25% for on-demand deposits, 2.6% on three-year deposits and 2.65% for five-year deposits.