China's top banks hold deposit rates despite official cut

US News

Page 1 of 2 | Next Page
Show Entire Article

China's top banks hold deposit rates despite official cut

Reuters | June 08, 2012 | 04:09 AM EDT

BEIJING (Reuters) - China's top five banks broke ranks with monetary policy on Friday, deciding not to pass on a cut in the official deposit rate and instead taking advantage of relaxed interest-rate controls to keep savings rates unchanged.

Banks have been forced for years to offer low rates, pushing savers into riskier investments such as property. The banks' decision not to pass on Thursday's cut is a sign that reform is releasing pent-up competition to win back deposits.

China's central bank cut the official rate on one-year deposits to 3.25 percent, part of a move to reinvigorate economic growth, but at the same time it gave banks more leeway to stray from the benchmark. They can now offer rates of up to 110 percent of the benchmark - up to 3.58 percent currently.

The five top banks are Industrial and Commercial Bank of China <1398.HK>, China Construction Bank <0939.HK>, Bank of China <601988.SS> <3988.HK>, Agricultural Bank of China <601288.SS> <1288.HK> and Bank of Communications <3328.HK> <601328.SS>.

Their websites on Friday all showed they were offering unchanged deposit rates of 3.5 percent.

Some smaller banks, including Bank of Ningbo, were more aggressive, lifting deposit rates to the limit of 3.58 percent.

Page 1 of 2 | Next Page
Show Entire Article

farrah abraham whats going on venus williams bowl projections bedlam bedlam cotto vs margarito 2