In the first quarter, the scale of bank wealth management products in operation increased by 9.51% year-on-year, down by 1.38 trillion yuan compared to the end of 2025.

Our reporter Yang Jie

On April 17, the China Banking Wealth Management Registration and Custody Center released the “Quarterly Report on the Chinese Banking Wealth Management Market (Q1 2026)” (hereinafter referred to as the “Report”), which shows that by the end of the first quarter of 2026, the total market product outstanding scale was 31.91 trillion yuan, a year-on-year increase of 9.51%.

Although the outstanding scale increased year-on-year, it has decreased compared to the end of 2025. The “Annual Report on the Chinese Banking Wealth Management Market (2025)” published by the China Banking Wealth Management Registration and Custody Center indicates that by the end of 2025, the outstanding scale of the banking wealth management market was 33.29 trillion yuan. The market scale in the first quarter of this year decreased by 1.38 trillion yuan compared to the end of 2025.

Industry insiders believe that the decline in the banking wealth management market scale in the first quarter of this year is due to multiple factors. Ming Ming, Chief Economist at CITIC Securities, told Securities Daily that firstly, seasonal patterns are the direct cause, as banks face deposit assessment pressures at the end of the first quarter, leading some wealth management funds to flow back into the banking balance sheet or deposit system; secondly, market volatility is an important driver, as global major asset classes fluctuated more significantly in March, and the A-share market correction caused some fixed income+ and hybrid wealth management products with equity positions to experience phased net value declines; thirdly, the persistently low interest rate environment continues to suppress returns on traditional fixed income assets, while increased deposit rates at small and medium-sized banks and the promotion of dividend insurance by insurance companies have diverted wealth management funds, weakening residents’ willingness to allocate to bank wealth management products.

“Besides seasonal factors like the Spring Festival and end-of-quarter fund inflows into the banking balance sheet, the ongoing low yields on assets and short-term market fluctuations should not be overlooked,” said Xue Hongyan, a special researcher at Su Commercial Bank, to Securities Daily. Under a structure dominated by fixed income products, falling bond yields have weakened the relative attractiveness of fixed income products. Additionally, in March, influenced by international geopolitical changes, major asset classes adjusted synchronously, causing some fixed income+ and hybrid products with equity allocations to experience phased net value declines, which to some extent increased redemption pressure at quarter-end and dragged down overall scale performance.

The “Report” shows that by the end of the first quarter of 2026, the outstanding scale of fixed income products was 30.84 trillion yuan, accounting for 96.65% of all wealth management products, a decrease of 0.57 percentage points from the same period last year; hybrid products had an outstanding scale of 0.98 trillion yuan, accounting for 3.07%, an increase of 0.60 percentage points from the same period last year.

“Although the market experienced short-term fluctuations, hybrid products grew against the trend in this quarter, reflecting that investors’ risk appetite for increasing equity allocations in a low-interest-rate environment has not changed. This structural adjustment in risk preferences continues,” Xue Hongyan said.

Ming Ming believes that in the second quarter of this year, wealth management scale is expected to recover. As seasonal factors fade, the inflow of on-balance-sheet demand deposits and large amounts of maturing fixed deposits are likely to flow back into the wealth management market driven by “interest rate spreads,” leading to a significant rebound in wealth management scale in the second quarter. Regarding product structure, “fixed income+” strategies and products with the shortest holding periods are expected to become the core directions for wealth management companies to absorb deposit migration and seek growth. Therefore, a return to growth in wealth management scale in the second quarter is highly probable, and the third quarter will likely be the largest window for growth.

Xue Hongyan believes that as seasonal disturbances subside, liquidity conditions in the second and third quarters tend to be more relaxed, and wealth management scale is expected to see a phased recovery. If bond yields stabilize or positive signals emerge in the equity markets during this period, the value of equity-including products will further stand out, attracting capital inflows. From a full-year perspective, the market scale is likely to return to growth, but considering the long-term downward pressure on performance benchmarks under a low-interest-rate environment, the growth rate may slow compared to previous years. The market will enter a new stage focused on structural optimization, with fixed income products still serving as the ballast, while the proportion of hybrid and equity products is expected to continue modestly increasing amid volatility.

(Edited by: Qian Xiaorui)

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