China's National Financial Regulatory Administration data show commercial banks'
net interest margin rose to 1.41% in Q2, up 0.01 percentage point QoQ — the
first quarterly increase since 2022. Margin moves were mixed by bank type:
state-owned big banks, city commercial banks, rural commercial banks and private
banks reported QoQ increases; joint-stock banks were flat; foreign banks fell.
Regulators and market participants attribute the stabilization to the liability
side — maturing high-yield deposits repriced lower and banks actively optimized
funding mixes to reduce interest cost — while regulatory guidance and an
interest-rate self-discipline mechanism helped curb irrational loan-rate cuts
and supported asset-side pricing, propping up NIMs.
