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Chinese lenders are aggressively issuing  Tier-2 and perpetual bonds  to secure ultra-low funding rates, with yields hitting their lowest levels  since records began in 2009 . 🔹  Tier-2 Bonds : Avg. coupon at 2.35% 🔹  Perpetual Debt : Avg. coupon at 2.31% “Banks are locking in cheap funding amid a drop in government bond yields. They don’t expect such low yields to sustain,”  said Timothy Tan, Bloomberg Intelligence. Capital bond issuance surged 23% QoQ  to a record ¥638.7B (≈US$89B) in Q2 2025. Context: Relief for banks facing shrinking net interest margins and rising bad loans Consolidation of smaller rural banks continues Commercial banks' capital adequacy ratio stands at 15.28%, down from 15.74% in 2024   Outlook : Bond supply may taper in H2 as Q2 placements front-loaded funding needs.

Chinese banks are expected to trim rates on 300 trillion yuan ($42.3 trillion) worth of deposits as early as this week, according to insiders, following recent stimulus measures that have further squeezed their already thin margins. Major banks, including Industrial & Commercial Bank of China Ltd. and China Construction Bank Corp. , are preparing to lower rates under guidance from the People's Bank of China’s (PBOC) interest rate self-disciplinary mechanism. The potential cuts, which have not yet been finalized, may include a 20-basis point reduction on one-year time deposits and a 25-basis point reduction on longer-term deposits . This would mark the second reduction this year, following a previous round in July. The move comes after China rolled out its most significant stimulus package yet to bolster its struggling economy, which included slashing policy rates and reducing borrowing costs on $5.3 trillion of mortgages . The PBOC has already made a historic cut to its...

China Minsheng Bank has cut salaries by up to 50% for employees at its Beijing branch , according to two sources familiar with the matter. This move, part of a broader austerity drive , is the largest pay reduction by a major Chinese commercial bank in recent years. The pay cuts come alongside the suspension of work-related expenses and other benefits for the 4,000+ employees at the bank’s Beijing branch. Although it remains unclear if these measures will be implemented at other branches, this austerity aligns with China's "common prosperity" initiative, which seeks to address social and income inequality . Minsheng Bank, founded in 1996 as China's first privately controlled commercial bank, has faced significant challenges, including exposure to the country's ongoing property crisis . The lender has been impacted by its role as a major creditor to China Evergrande Group and the financial difficulties of China Oceanwide , one of its largest shareholders. The ...