Loan end is "tightening the gold hoop" and deposit end is "tightening the belt", the challenges for private banks remain unsolved.

Private banks that once attracted customers through high-interest deposits and increased revenue through internet-assisted lending are now trapped in a situation of both rising liabilities and falling assets. Under the new regulations on internet lending, the model of relying on lending companies to attract customers is not sustainable. The loan business scale and profit margin are shrinking, and under the pressure of continuously narrowing net interest margins, banks are struggling to bear the high interest costs, leading to adjustments such as lowering interest rates, removing mid to long-term deposits from shelves, optimizing product structures, and offsetting the revenue gap caused by the shrinking credit business. On one hand, the loan business is contracting with no room for revenue growth, while on the other hand, they are actively cutting off high-cost deposits and controlling expenses. The interconnected changes of contraction and reduction are questioning private banks on how to develop in the dilemma of no longer being in a high-interest rate environment, narrowing customer acquisition channels, and insufficient self-operating capabilities.