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Fitch Projects Prolonged Low-Interest-Rate Environment in CN, Rated CN Banks to Remain Resilient
2026-04-16 14:59:16 China's low interest rates may persist for a longer period, as feeble domestic demand and external shocks, including the Iran conflict, weigh on growth, continuing to pressure the profit of Chinese banks, Fitch Ratings said, while expecting the operating environment of the banking sector and the Viability Ratings of rated banks to remain resilient. Fitch noted that the resilience of rated banks is underpinned by their stable deposit franchises, prudent asset-liability strategies, and policy settings that prioritize financial stability. The Viability Ratings of rated banks range from bbb to b+, with reasonable buffer capacity. In addition, Fitch believed a prolonged low-interest-rate environment will not materially alter these banks' asset-liability strategies, earnings mix or competitive dynamics. Banks are expected to maintain disciplined liquidity management and avoid excessive interest rate or refinancing risks. Moderate growth in recent years has supported their liquidity positions and capital levels, while increased financial investments are balanced by large concentration in government bonds and China’s regulated rate environment. ~ AASTOCKS Financial News Website: www.aastocks.com | |