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.
To protect bank profits, Beijing controls China's interest rate market. It cut the official loan rate as well on Thursday but allowed banks to offer loans at as low as 80 percent of the loan benchmark, compared with 90 percent previously.
Economists have long said that Beijing's tight control over rates distorts the price of credit, and that higher deposit rates will lead to a better allocation of capital.
Deposit rates have often failed to keep pace with inflation, forcing depositors to seek alternative ways to store their cash. Property has become a favored choice over time as Chinese savers see home-ownership as a sure way to preserve wealth.
The rush into China's property market has driven house prices to record highs, leading many analysts to warn of a possible financial bubble and prompting the government to take recent action to curb the market.
(Reporting by Beijing and Shanghai bureaux; Editing by Don Durfee and Mark Bendeich)
- Reuters - Esta publicación incluye información y datos que son de propiedad intelectual de Reuters. Queda expresamente prohibido su uso o el de su nombre sin la previa autorización de Reuters. Reservados todos los derechos.