At the start of 2026 a headline debate over “50 trillion yuan of maturing deposits” reignited public concern about where household savings will land. The People’s Bank of China used its Q4 2025 monetary policy report to provide a data-driven rebuttal to talk of a wholesale exodus from banks, arguing that much of the money reallocated into asset-management products (AMPs) remains functionally inside the banking system.
Falling deposit rates since 2024 have encouraged savers and companies to hunt higher yields outside traditional time deposits. The report notes one-year fixed deposit rates have declined by about 0.5 percentage points since 2024, while cash-management funds and other AMPs continued to offer higher returns, prompting a rotation of household and corporate assets into wealth-management products, funds and other non-deposit vehicles.
By the end of 2025 Chinese asset-management assets totaled roughly 120 trillion yuan, up 13.1% year-on-year, with about 56.3 trillion yuan sourced from households and firms and growing at 9.7%. Bank wealth-management products and public mutual funds were among the fastest-growing segments, expanding 10.6% and 14.3% respectively, underscoring how retail and corporate savings have been redeployed into market-based instruments.
Yet the PBOC’s consolidated perspective suggests these flows are a transformation of funding structure rather than a departure from the banking system. More than 80% of AMP portfolios are invested in fixed-income instruments, and new allocations have been concentrated in interbank deposits and certificates of deposit. At end-2025 AMPs held about 28.7 trillion yuan in interbank deposits and CDs, up nearly 19% year-on-year and representing roughly half of newly added underlying assets in the sector.
That matters because when AMPs invest in interbank deposits or CDs they become non-bank deposits within banks’ balance sheets; when they buy bonds or fund corporate lending, proceeds frequently cycle back to banks through borrowers’ accounts. The PBOC therefore frames the shift as a change in composition — retail and corporate deposit shares are down while interbank funding shares are up — whereas the combined growth pace of deposits plus AMP-linked funding tracks closely with broad money (M2).
The report also flags diversification beyond deposit-like allocations: bonds, equities and non-standard credit instruments remain meaningful destinations. Bond and non-standard credit holdings have been relatively stable in 2025 while equity exposure has varied with market swings, signaling that asset managers and clients are balancing yield-seeking with risk tolerance.
For regulators and banks the takeaway is practical: the system is not witnessing a mass withdrawal of savings into some parallel shadow system, but it is undergoing a material reconfiguration of liability structures. Rising reliance on interbank placements and non-deposit funding can amplify sensitivity to market liquidity and interest-rate cycles, even if headline deposit totals remain robust when consolidated with AMP funds.
Policymakers face a trade-off. Allowing market rates to adjust would ease the incentives for deposit-to-AMP migration but could pressure banks’ funding costs and loan margins. Tightening rules on AMPs could stem the flow but risks curbing financial-market development and investor choice. The PBOC’s report aims to reassure, but it also implicitly signals that close monitoring and possible policy fine-tuning will be needed as China's savings are increasingly intermediated through market channels rather than traditional deposits.