Sept 25, 2013
Translated by Elsa Gao

China’s Big Four banks - Bank of China, ICBC, Agricultural Bank of China and China Construction Bank –together lost 202 billion yuan in deposits from Sept 1 to 22 as two approaching national holidays caused large scale withdrawals.  

This has put pressure on the banks to collect enough deposits to meet the 1 trillion yuan they need to meet their liquidity requirements. Some branches have raised interest rates on time deposits by as much as 10 percent and some are even offering gimmicks, like one community bank that’s advertising a free jug of soybean oil for depositing 20,000 yuan.

The situation so far doesn’t appear to have impacted the amount of loans being issued. 220 billion yuan in loans were given from Sept 1 to Sept 22 by the Big Four banks, and that number is expected to exceed 600 billion yuan by the end of the month.

With the real estate market still booming, personal mortgage loans do appear to be tightening. According to Zhang Dawei (张大伟), director of the market research department of Centerline Property, the 15 percent discount for first time buyers on mortgage loans that was once common in Beijing is now virtually non-existent. It’s now rare for any discount to exceed 10 percent.

Zhang says that while none of the major banks have officially suspended issuing mortgage loans, some have completely stopped offering discounts - which has all but prevented customers from seeking them. Zhang suggests potential borrowers should make their loan applications as soon as possible, otherwise they might face an even tighter credit atmosphere after October.

Links & Sources
21st Century Business Herald: 9月前三周四大行存款流失超2000亿