Small and Medium Banks Cut Deposit Rates as Major Banks Offer 0.955% for One-Year Term

In the second half of 2026, several small and medium banks in Zhejiang, Jiangsu, Henan, and Guangdong adjusted their posted deposit rates. Zhejiang saw the most activity, with Wenzhou Bank applying new rates from July 22. Its three-month, six-month, one-year, two-year, and three-year lump-sum deposit rates are 1.1%, 1.3%, 1.4%, 1.55%, and 1.75%, respectively. Dinghai Deshang Rural Bank also lowered its seven-day deposit rate by 0.05 percentage point to 0.8% and its one-year deposit rate by 0.1 percentage point to 1.4%, effective July 22. A branch of Bank of Ningbo in Ningbo city stated that its three-year time deposit annualized rate is 1.55%, while the two-year rate is 1.3% for deposits of RMB 50 or more, 1.45% for RMB 50,000 and above, and 1.5% for RMB 200,000 and above, with no recent adjustment.

Banks in Jiangsu, Henan, and Guangdong also cut their deposit rates. A branch of Bank of Nanjing said the bank reduced its three-year time deposit rate from 1.8% to 1.76% in July. Henan Huixian Zhujiang Rural Bank adjusted its three-year time deposit rate from 1.6% to 1.55%, a cut of 0.05 percentage point, on July 24. Guangdong Chaoyang Rural Commercial Bank lowered its agreement deposit rate from 0.75% to 0.65% in June.

In the latest round of deposit rate adjustments, small and medium banks moved ahead of major state-owned banks, but their time deposit rates generally remain higher. On July 22, the one-year time deposit rate at major state-owned banks stood at 0.955%, while most joint-stock banks and city and rural commercial banks posted one-year rates above 1%. As of the first quarter of 2026, the net interest margin for China's commercial banks was 1.4%, down 0.02 percentage point from the fourth quarter of 2025.