Is the turning point here? ICBC expects this year's net interest margin trend to follow an L-shape, with net interest income likely to turn positive.

Ask AI · What drives the return to positive growth behind net interest income?

Beijing News Shell Finance, reported by reporter Jiang Fan: Bank net interest margins have been declining for years. When will the “turning point” arrive? On March 27, Yao Mingde, vice president of Industrial and Commercial Bank of China, said at a performance briefing that it is expected the banking industry’s net interest margin in 2026 will follow an “L-shaped” trajectory. Meanwhile, it may continue to decline, but the rate of decline will gradually narrow. At the same time, this year, growth in banks’ net interest income is expected to turn positive year over year, ushering in the turning point.

“Although the yield on bank loans in 2026 will still continue to trend downward, the rate of decline will be less steep.” Yao Mingde said that the last adjustment to the Loan Prime Rate (LPR) was in May 2025, and its impact has already been fully released.

From the data, interest rates on newly issued loans across various loan categories have already stabilized. Yao Mingde said that in the first two months of this year, the decline in newly issued loan interest rates at Industrial and Commercial Bank of China was 18 basis points less than in the same period last year. But considering that the LPR still has the possibility of being lowered this year, the yields on various loans may continue to move downward.

Editor Yuecai Zhou

Proofreader Muxiang Tong