Banks Intensify Redemptions of High-Yield Preferred Shares, Institutional Asset Management Faces "Plain Jane" Allocation Dilemma

Ask AI · How do low interest rates drive banks to optimize their capital structure?

Since last year, with the declining interest rates on new issuances of secondary capital bonds, perpetual bonds, and other capital instruments, more and more banks are choosing to proactively redeem high-interest preferred stocks. Last year, nine banks redeemed over 100 billion yuan of domestic and overseas preferred stocks, further shrinking the existing market size. In response, researchers stated that this move is a practical choice for commercial banks to “redeem old and issue new” in order to optimize their capital structure and reduce financial costs. (Securities Times)