Many banks in Guangdong lowered their interest rates, and cross-city deposits became popular again

After China’s state-owned banks and joint-stock banks lowered their deposit rates, many small and medium-sized banks in Guangdong followed suit and announced a reduction in deposit rates since August.

Nandu Wancaishe reporters noticed that in this reduction, many small and medium-sized banks adjusted the listed interest rates for 3-year and 5-year fixed deposits by a large margin. After this reduction, the medium- and long-term fixed deposit rates of many small and medium-sized banks have entered the “1 era”. Under the temptation of the interest rate spread of similar deposits in different banks, the phenomenon of “cross-city deposits” has become popular again.

The deposit rates of many small and medium-sized banks bid farewell to the “3-digit”

This round of deposit rate cuts began on July 25 when the six major state-owned banks collectively announced the adjustment of the listed interest rates for RMB deposits. Judging from the rhythm of the previous rounds of deposit rate cuts, the big banks took the lead, followed by joint-stock banks, city commercial banks, and rural commercial banks.

The overall rate cut pace of the industry has accelerated significantly this time. Less than a week after the big banks announced the adjustment of deposit rates, 12 joint-stock banks have also completed the deposit rate cut. Guangzhou Rural Commercial Bank, Dongguan Rural Commercial Bank, Dongguan Bank and many other Guangdong city and rural commercial banks have also followed suit and adjusted their deposit interest rates.

Reporters noticed that some small and medium-sized banks have significantly increased the adjustment of 3-year and 5-year fixed deposit rates, far exceeding the reduction in deposit rates of the aforementioned large banks and joint-stock banks. After this adjustment, the deposit interest rates of many banks have also bid farewell to the “3-digit” era.

Specifically, the current deposit interest rates of Guangzhou Rural Commercial Bank, Dongguan Rural Commercial Bank, Nanhai Rural Commercial Bank, Shunde Rural Commercial Bank (Shunde area) and Dongguan Bank are all 0.15%, and the current deposit interest rate of Zhuhai China Resources Bank is 0.2%.

In terms of medium- and long-term fixed deposit interest rates, the three-year deposit and withdrawal interest rates of Guangzhou Rural Commercial Bank, Nanhai Rural Commercial Bank and Shunde Rural Commercial Bank (Shunde area) are 1.8%, the three-year deposit and withdrawal interest rates of Dongguan Bank and Dongguan Rural Commercial Bank are 1.85%, and the three-year deposit and withdrawal interest rates of Zhuhai China Resources Bank and Zhuhai Rural Commercial Bank are 2.05% and 2.3% respectively.

Among the five-year fixed deposit and withdrawal listed interest rates, Nanhai Rural Commercial Bank and Shunde Rural Commercial Bank (Shunde area) are both 1.8%, Guangzhou Rural Commercial Bank is 1.85%, Dongguan Bank and Dongguan Rural Commercial Bank are 1.9%, Zhuhai China Resources Bank and Zhuhai Rural Commercial Bank are 2.05% and 2.35% respectively.

Du Yang, a researcher at the China Banking Research Institute, said that small and medium-sized banks followed up to reduce fixed deposit interest rates mainly to reduce liability costs. Since the beginning of this year, the net interest margin pressure faced by small and medium-sized banks has increased. By lowering the deposit interest rate, it can not only increase the interest income level of small and medium-sized banks, but also provide space for further promoting the reduction of asset-side interest rates, and enhance the ability of small and medium-sized banks to serve the local real economy.

The interest rates of the same bank in different regions may be different

Nandu Wancaishe reporters found that although the current deposit interest rates have been lowered, some small and medium-sized banks still have popular large-denomination certificates of deposit products, such as the annual interest rate of 5-year large-denomination certificates of deposit (exclusive for new customers) on the product shelves of some bank APPs can reach 3%, and the interest rate of 3-year large-denomination certificates of deposit products ranges from 2.55% to 2.85%.

Ai Yawen, an analyst at Rong360 Digital Technology Research Institute, suggested that citizens can “shop around” when buying deposit products, and give priority to products with relatively long terms to lock in deposit interest rates. In addition, pay attention to the special deposits, large-denomination certificates of deposit and other products of small and medium-sized banks, which are generally higher than the market average, but these products may have specific starting deposit amounts, terms or interest calculation rules, and you need to read the product description carefully.

In addition, when the reporter counted the deposit interest rates, he also found that the same bank had different interest rates in different regions. For example, the deposit interest rate table of Shunde Rural Commercial Bank is divided into six regional versions. Among them, the two-year fixed deposit interest rate in Shunde is 1.5%, and the two-year fixed deposit interest rate in Nanhai is 1.8%, which is 0.3 percentage points higher than that in Shunde.

Therefore, there are also many “deposit special forces” phenomena – spanning several cities or regions, just to buy deposit products with a higher annual interest rate.

On some social platforms, many netizens have shared their experiences of depositing money in other places. At the end of last year, some netizens shared their experience of depositing money from Gansu to Sichuan. Information such as “round trip by hard sleeper” and “staying for ten hours” attracted many netizens to watch. Many of them asked about deposit “strategies” and some questioned the safety of this deposit method.

Focus

What are the advantages and disadvantages of “cross-city deposits”?

So is “cross-city deposits” really feasible? The reporter called the Shunde Rural Commercial Bank as a customer to inquire about the specific information on handling cross-city deposits. The reply was: cross-city deposits also require an account in the bank. The person can bring his ID card and work certificate (optional) to the bank counter to open an account and then deposit. However, the staff member also reminded that because the bank is a regional independent institution and only has branches or sub-branches in Guangdong, if the distance is far or in other provinces, it is recommended to go to the four major banks with branches across the country to handle deposits, so as to facilitate withdrawals. Cross-city deposits still need to be carefully considered and weighed.

In this regard, Ai Yawen said that cross-city deposits need to consider transportation, time and opportunity costs. If the deposit bank does not have a branch in the depositor’s place of residence, it may be inconvenient to withdraw money. In addition, depositors should also ensure that cross-city deposits comply with the financial regulatory regulations of the local area and the location of the deposit bank to avoid unnecessary legal risks due to lack of understanding of local policies.

Why are there regional interest rate differences?

So, why are there regional interest rate differences? Dong Ximiao, chief researcher of CITIC Bank, pointed out that the obvious deposit interest rate spread between different regions and banks is the main reason for the “cross-city deposits”. The reasons for the spread are mainly reflected in three aspects. First, the deposit floating range and upper limit agreed by the market interest rate self-discipline pricing mechanism in different regions may be different; second, the supply and demand relationship of the deposit market in different regions is different, and customers have different investment preferences and savings habits, which affects the pricing of deposit interest rates; third, different branches of the same bank have different asset-liability situations and market competition strategies, and naturally have different deposit demands and pricing.