As 2026 begins, the large-denomination certificate of deposit (CD) market continues to undergo profound changes: the interest rates for CDs with terms under one year offered by large state-owned commercial banks and some small and medium-sized banks have fallen below 1%, while rates for medium to long-term products are also mostly below 2%.
This shift has left many investors feeling conflicted. After previously held three-year CDs with rates around 3.3% mature, the significantly lower returns available today have dampened the enthusiasm for renewal. Some are turning to the CD transfer market to seek higher-yielding options, while other risk-averse investors are shifting their focus towards structured deposits. With the recent surge in gold market activity, many newly issued structured deposits from banks are linked to gold, particularly those from foreign banks, which advertise potential annualized returns exceeding 5%, tempting some investors to "test the waters with small amounts."
Faced with the new normal of persistently low interest rates, investors are constantly weighing returns, risks, and liquidity with every choice, from large CDs to structured deposits. How to adjust asset allocation to best suit one's own needs has become a central question in personal finance management.
The interest rates on large CDs, once a powerful tool for attracting deposits, continue to fall. In 2025, the four major state-owned commercial banks—ICBC, Agricultural Bank of China, Bank of China, and China Construction Bank—had already reduced the annual interest rates on their one-month and three-month CDs (with a minimum deposit of 200,000 yuan) to 0.9%. Subsequently, some smaller banks followed suit, also adjusting their three-month CD rates down into the "zero-percent range."
Public information from China's money network shows that since the start of 2026, over 30 commercial banks have issued new large CDs. It was noted that Mengla Rural Commercial Bank, issuing its first 2026 series CD starting January 4th for a three-month term with a 200,000 yuan minimum deposit, offers an annual interest rate of 0.93%. Similarly, Yunnan Tengchong Rural Commercial Bank's first 2026 series CD, issued from January 7th, also for three months with a 200,000 yuan threshold, carries a 0.95% rate. Yunnan Longyang Rural Commercial Bank's first 2026 series CD, issued on January 5th, also a three-month product with a 200,000 yuan minimum, saw its rate similarly adjusted down to 0.95%.
In terms of maturities for newly issued large CDs from major commercial banks, three-month, six-month, and one-year products are more common, while three-year and five-year products are scarce. Regarding annual interest rates, newly issued products generally maintain rates below 2%, narrowing the gap with rates on ordinary time deposits.
Furthermore, it was observed that although some banks still offer CD rates above 1.5%, these products are often marked as "sold out." For example, Guangdong Huaxing Bank's six-month and one-year products, requiring a 200,000 yuan deposit and offering annual interest rates of 1.5% and 1.6% respectively, are already unavailable.
Commenting on this, Wang Pengbo, Chief Analyst at Bocon Consulting, stated that commercial banks are under continuous pressure on their net interest margins. Reducing large CD rates and scaling back the issuance of long-term products are reasonable choices for controlling liability costs. He believes there is still room for CD rates to decline further, and the issuance scale will likely continue to shrink. The scarcity of long-term products may persist, a trend that will run through the entire process of optimizing the liability structure of commercial banks, potentially diverting some funds to other assets with relatively higher returns.
Against the backdrop of continuously falling CD rates, many investors have already "moved" to the CD transfer market. An investor working in accounting in Guangzhou mentioned that three years ago, she purchased a three-year CD with a 3.3% annual rate. Recently, this product matured, but she has no intention to renew. The reason is she found current CD rates persistently declining, with most products below 2%, and some banks have even stopped issuing three-year CDs altogether, making the returns on new products unattractive.
In this context, she turned her attention to the CD transfer market, searching for transferred products with rates above 2.5%. After some screening, she successfully acquired a CD from a private bank with a remaining term of over 1,300 days and a transfer annual interest rate of 3.15%, thus locking in a high-yield investment as desired.
While deposit rates continue to fall, international gold prices have been soaring. Many bank financial managers have begun recommending gold-linked structured deposits to their clients. These structured deposit products display an expected return rate as a variable range. From the perspective of these financial managers, in a low-interest-rate environment, structured deposits, as products that can both protect principal and offer potentially higher returns, are suitable for risk-averse investors.
Recently, several banks have been intensively issuing gold-linked structured deposits. For instance, Huaxia Bank began selling a USD-denominated personal structured deposit product on January 21st named "Huiying USD 0044 Triple Bullish on International Spot Gold." It is linked to international spot gold, has a 29-day term, a risk rating of R1, and a minimum deposit of $2,000. Depending on the performance of the underlying asset, the expected annualized return ranges from 0.80% to 3.30%. The product documentation indicates that only the principal is guaranteed at maturity, not the returns.
Investor Ms. Li recently came across a gold-linked structured deposit issued by a large commercial bank. It has a six-month term, a minimum investment threshold of 10,000 yuan, and promises capital protection. The return consists of two parts: a basic deposit return and a return from derivative investments, with an expected annualized return between 1% and 2.09%.
Ms. Li mentioned that after comparing similar structured deposit products from various large commercial banks, she found that while this product's return isn't the highest, its advantage lies in the low entry barrier. Some banks offer products with terms over six months and expected annualized returns above 3%, but those require a minimum investment as high as 300,000 yuan.
She carefully reviewed the product's documentation; the rules for calculating returns are clear: if gold rises more than 11% within six months, the maximum return of 2.09% is achieved; if the international spot gold price fluctuates between $4,000 and $5,000 per ounce, a return of 1.89% is obtained; if the gold price falls more than 10%, only the guaranteed minimum return of 1.00% is received.
Ms. Li's financial manager analyzed her situation: gold prices are currently at historical highs, so the probability of a significant rise isn't very high, perhaps only 10%, while the chance of fluctuation is 40%, and the probability of a decline is about 50%. Calculating the probabilities for all three scenarios, the average expected annualized return for this product is around 1.5%, slightly higher than the typical time deposit rate.
The financial manager suggested that if Ms. Li needs the money in six months and is firmly optimistic about gold's trend, she could consider investing. If the funds won't be needed for over a year, other medium-to-low risk wealth management products from the bank might be recommended instead; although not principal-guaranteed, they are likely to outperform structured deposits in the long run. However, as Ms. Li was personally keen to try a gold-linked product, the investment amount wasn't excessively high, and the principal was guaranteed, she ultimately decided to allocate some funds to gain relevant investment experience.
Besides Chinese banks, several foreign banks have also launched gold-linked structured deposit products, often with higher expected annualized returns than those from Chinese banks. For example, Standard Chartered Bank launched a principal-protected structured deposit linked to the SPDR Gold Trust on January 20th. It requires a minimum investment of $10,000, offers an expected annualized return between 2% and 5%, but has a lengthy investment period of two years.
It is important to note that not all structured deposit products guarantee the full principal; some are non-principal protected, and certain non-guaranteed products carry higher risk ratings.
For instance, according to information on HSBC China's WeChat official account, the bank launched a "Ying Zhuan Ling Dong" series structured deposit on January 19th. It is linked to the SPDR Gold Trust and the VanEck Vectors Gold Miners ETF, carries a risk rating of Level 3, offers 90% principal protection at maturity, requires a minimum investment of 200,000 yuan, has a six-month term, and boasts a maximum expected annualized return of up to 7.2%. The product documentation also emphasizes that, as structured deposits contain an investment component, their returns can vary. For this series, investors might receive zero return or even lose part of their principal over the investment period.
Regarding this, Wang Pengbo commented that with the recent heat in the gold market and rising investor optimism about gold price trends, newly issued structured deposit products from banks are commonly linked to gold. He noted that while the maximum returns advertised for gold-linked structured deposits are attractive, achieving these returns is highly dependent on gold price movements and involves significant uncertainty. Additionally, structured deposits do not allow for early withdrawal; investors must carefully match the product's term with their own liquidity needs when making a selection.
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