China has suspended the issuance of certificate savings bonds that were originally planned to be released on Tuesday, citing the concerns over current COVID-19 flare-ups that have hit multiple places across the country.

Compared with electronic savings bonds, certificate savings bonds can only be purchased on-site at a bank counter, meaning greater risk of spreading the coronavirus.

Several financial institutions posted notices addressing the suspension on Tuesday.

“Given the current situation of COVID-19, the People’s Bank of China and the Ministry of Finance have made a unified work arrangement, and the issuance of savings bond (certificates) will be suspended in May 2022,” China Merchants Bank said in a notice.

“In view of the fact that the current epidemic situation is not suitable for investors to queue up to buy bonds at the counter, the sale of savings bonds (certificates) originally scheduled to be issued in May 2022 have been suspended,” read the notice by the Bank of Communications.

The Ministry of Finance announced on Thursday that it will issue a group of three-year and five-year certificate savings bonds on Tuesday. According to the 2022 savings bonds issuance schedule, the two types of certificate savings bond will be issued on the 10th of each month from March to November.

“Now, against the background that bank wealth management products not having a good profit and the interest rate of fixed deposits falling, savings bonds are very popular, many investors are likely to queue up at bank counters, thus increasing the risks of virus spreading,” an insider from a financial institution told the Global Times on the condition of anonymity.

Recently, a number of domestic banks announced that they will cut the interest rate of medium and long-term deposits and the interest rate of large-denomination certificates by 10 basis points. After the adjustment, the highest three-year fixed deposit rate is only 3.15 percent.

Global Times