The yield rate has fallen below 2% for the first time; 29 bank wealth management products failed to raise funds at the start of the year.

21st Century Business Herald Reporter Ye Maishui

Financial products worth 33 trillion yuan are experiencing growing pains, frequently stumbling during issuance.

Since the beginning of the year, many leading wealth management institutions have announced the failure to establish newly issued products, mainly due to fundraising shortfalls. Some products have a minimum fundraising threshold as low as 5 million yuan. According to Tonghuashun statistics, at least 29 products have been affected. Analysts believe this is an inevitable result of intensified homogeneous competition among fixed-income products in a low-interest-rate environment. Last year, the average return on bank wealth management products first fell below 2%, reaching only 1.98%, indicating a decline in attractiveness.

29 Products Fail to Launch

On March 19, Huaxia Wealth Management announced that Huaxia Wealth Management HeXiang Fixed Income Wealth Management Product No. 37 failed to meet the minimum fundraising requirement specified in its prospectus and thus was not established. Investors who purchased through Huaxia Wealth Management will have their funds returned to their wealth management accounts within two business days after the original establishment date (March 19, 2026). For those who purchased through other distributors, the specific account, date, and time of fund return will be subject to the distributor’s payment regulations.

This is not the first product from Huaxia Wealth Management to fail due to insufficient fundraising. According to Tonghuashun, in March alone, Huaxia Wealth Management issued six notices of non-establishment. Besides the aforementioned product No. 37, these include “Fixed Income Debt-Type Closed-End Wealth Management Product No. 1317,” “Pure Debt Fixed Income Closed-End Wealth Management Product No. 354,” “Yue An Xin Fixed Income Pure Debt Closed-End Wealth Management Product No. 83,” “Fixed Income Debt-Type Closed-End Wealth Management Product No. 1381,” and “Fixed Income Debt-Type Closed-End Wealth Management Product No. 1002,” totaling five products.

From the product prospectuses, all six are closed-end, net value-based fixed income products, mainly rated as medium-low risk, generally stable. The durations vary widely—from as short as 97 days to nearly three years—covering short-, medium-, and long-term investment needs.

In terms of investment focus, product positioning shows some differentiation. The “HeXiang Fixed Income Wealth Management Product No. 37” combines money market instruments, various debt assets, and a small amount of equity assets. The other five products focus solely on pure fixed income, mainly money market tools, standardized debt assets, and other fixed income financial instruments compliant with regulations. Most have a minimum issuance threshold of 50 million yuan, except for the low-risk “Huaxia Wealth Management Fixed Income Debt-Type Closed-End Wealth Management Product No. 1381,” which has a lower limit of 5 million yuan.

According to Tonghuashun, since the start of the year, 29 bank wealth management products have failed to raise sufficient funds and have been “lost in the sand.” These include products from Puhui Wealth Management, Guangdong Nanhai Rural Commercial Bank, China Merchants Bank Wealth Management, Bohai Bank Wealth Management, Guangfa Bank Wealth Management, Everbright Wealth Management, Huihua Wealth Management, and others.

For example, Puhui Wealth Management recently announced that it issued the Puhui Wealth Management Qi An Yue Company-specific Wealth Management Product No. 2603 on March 4, 2026, with the subscription period ending on March 10, 2026. Due to the total subscription amount not reaching the minimum specified in the prospectus, the product was not established. Puhui Wealth Management will refund all investors’ subscription funds within two business days after the subscription period ends.

Even industry leaders are not immune. China Merchants Bank Wealth Management recently faced setbacks. In mid-February, it announced that its “Zhaorui Jiayue (Technology Growth) Day-Open 370-Day Holding Period No. 1” fixed income enhancement plan, originally scheduled to raise funds from February 6 to February 10, 2026, did not meet the minimum fundraising requirement. According to relevant agreements, the plan was deemed not to be established.

Analyzing the reasons behind these failed products, market consensus points to several factors: first, supply-side issues—product types are highly concentrated and homogeneous, mainly closed-end fixed income, which under the overall declining interest rate environment, may not offer enough attractive returns; second, demand-side factors—investors generally prefer liquidity and are more cautious about risk, leading to limited interest in longer lock-in period products. Additionally, as wealth management firms become more sophisticated in operations, they tend to proactively terminate issuance if initial fundraising expectations are too low, reflecting more rational and cautious market decision-making.

Wu Zewei, a special researcher at Sichuan Commercial Bank, stated that this is an inevitable result of intensified homogeneous competition among fixed income products in a low-interest-rate environment. As market yields continue to decline, traditional closed-end fixed income products become less attractive to investors. If wealth management firms continue to follow past scale-driven issuance strategies, they will face difficulties in fundraising. This also indicates a certain mismatch between product offerings and capital demand in the wealth management market.

Banks Massively Lower Performance Benchmarks

Alongside fundraising failures, banks are also collectively lowering their performance benchmarks. According to Tonghuashun, since the beginning of the year, 2,023 bank wealth management products have adjusted their performance benchmarks.

For example, on March 11, Shenzhen Rural Commercial Bank announced an adjustment to the benchmark of its “Xin Tong Wealth Management – Zhen Yuan Jin Nian Nian Ying” Product No. 39. The bank stated that, due to current market interest rate changes and fund operation conditions, it plans to adjust the benchmark from March 27, 2026. Before the adjustment, the benchmark was 2.30%-3.05%; after, it will be 2.15%-3.00%, a change of 5 to 15 basis points.

Minsheng Wealth Management’s “Gui Zhu Fixed Income Enhancement Two-Year Open No. 2” product saw its benchmark drop sharply from 4%-6% to 2.6%-3.1%, a maximum reduction of nearly 50%.

Starting February 3, 2026, the benchmark for the Agricultural Bank of China Wealth Management’s “Agricultural Bank Anxin Lingdong 7-Day RMB Wealth Management Product (Corporate Exclusive)” was lowered from 2.20%-3.20% (annualized) to 1.70%-2.20%, a decrease of 100 basis points.

Additionally, the Agricultural Bank of China Wealth Management announced adjustments to the benchmark of its “Agricultural Bank Progress • Two-Year Open” Value Selection Phase 1 RMB Wealth Management Product, which from March 11, 2026, will have its benchmark changed from “3.40%—4.55% (annualized)” to “2.20%—3.00% (annualized),” with the upper limit down by 155 basis points and the lower limit down by 120 basis points.

Besides significant reductions in benchmarks, many wealth management firms are also shifting some products’ benchmarks to index-based or market rate-based measures.

Xingyin Wealth Management announced that it would adjust the benchmark of its “Stable Add Profit Daily Increase No. 6” fixed income product from an annualized 2%-2.7% to the “People’s Bank of China 7-day Notice Deposit Rate,” effective February 9.

Zhaorui Wealth Management also announced that the benchmark for its “Zhaorui Daily Open 30-Day Rolling No. 1” would be adjusted from 2%-3.7% to “30% × People’s Bank of China savings deposit rate + 70% × ChinaBond 0-3 Month Treasury Bond Index Yield,” effective March 10.

The China Banking Wealth Management Market Annual Report (2025) released by the Bank Wealth Management Registration and Custody Center shows that by the end of 2025, the market’s outstanding scale reached 33.29 trillion yuan, an 11.15% increase from the start of the year, reaching a new level. However, yields were disappointing, with the average annualized return last year at only 1.98%, down 67 basis points from 2024’s 2.65%, marking the first time falling below 2%.

Rangpai.com’s public fund product operations director Fang Fang believes that as yields continue to decline, the failure of bank wealth management fundraising may become the norm. On one hand, the macro environment of “low interest rates” and “asset scarcity” is unlikely to change in the short term, making it challenging to create attractive and competitive products. On the other hand, wealth management firms are becoming more mature in their product strategies and operations, no longer pursuing issuance volume blindly, and will promptly adjust products that do not meet preset standards. Meanwhile, industry segmentation and consolidation will become more pronounced, with resources increasingly concentrated in products and managers with strong investment capabilities and stable performance. Products lacking clear positioning and distinctive features will face greater exit pressures. This is essentially a stage where market mechanisms are functioning to promote higher industry efficiency.

Looking ahead, the way for wealth management products to break through lies in truly practicing a “customer-centric” philosophy, relying on differentiated strategies and solid investment management capabilities to build core competitiveness. Specifically, it involves: first, enriching and optimizing product lines to design diversified offerings that meet different risk preferences, return targets, and liquidity needs; second, continuously strengthening and improving research and investment capabilities to establish and maintain customer trust through verifiable, long-term, sustainable returns; third, enhancing full-process investor engagement and service, providing professional and personalized asset allocation solutions to deepen customer relationships and build a solid business moat.