China's commercial banks have significantly accelerated capital replenishment efforts this year, with regional lenders intensifying fundraising activities particularly in the second quarter. Financial data reveals that as of July 15, domestic banks issued 57 batches of Tier 2 capital bonds and perpetual bonds (collectively termed "T2 bonds and perpetual bonds"), raising a total of 894.56 billion yuan.

Industry specialists observe that as profitability declines and internal capital accumulation shrinks, banks increasingly rely on these external financing instruments to bolster financial resilience. Recent bond issuances illustrate this trend: Bank of Guangzhou secured regulatory approval for 4 billion yuan in perpetual bonds on July 10, while Chengde Bank completed a 1.5 billion yuan perpetual bond issuance at 2.80% coupon on June 25. Similarly, Lanzhou Bank received clearance for up to 5 billion yuan in perpetual bonds, and Xi'an Bank obtained approval for 7 billion yuan. Chouzhou Commercial Bank gained authorization for 4 billion yuan in Tier 2 capital bonds on June 16.

Notably, second-quarter issuances surged to 638.7 billion yuan across 43 batches, dwarfing the first quarter's 173.86 billion yuan from just 9 issuances. June alone witnessed 17 regional banks—including Chouzhou Commercial Bank, Sichuan Bank, and Qingdao Rural Commercial Bank—actively replenishing capital. Du Yang of Bank of China Research Institute explains that both listed and unlisted banks favor these instruments: listed firms struggle with share dilution amid depressed stock prices, while regional lenders face limited capital-raising alternatives.

The capital gap between institutions remains stark. While Agricultural Bank raised 60 billion yuan in Tier 2 bonds on June 17, following its earlier 50 billion yuan perpetual bond offering, major state-owned banks like ICBC, CCB, and BOC each issued approximately 40-50 billion yuan in May. Meanwhile, regional lenders have raised over 100 billion yuan since April, predominantly from economically vibrant Jiangsu, Zhejiang, and Guangdong provinces.

Regulatory disclosures highlight the capital adequacy divide: city commercial banks (12.44%) and rural commercial banks (12.96%) lag far behind state-owned banks (17.79%) in Q1. Su Xiaorui, senior researcher at Suxi Intelligence, attributes regional banks' urgency to regulatory encouragement and fundamental needs, noting that IPO fundraising remains challenging compared to bond issuance.

Experts propose multi-channel solutions to address capital shortages. Zeng Gang of Shanghai Finance & Development Laboratory advocates expanding qualified investor pools and facilitating bank listings. Dong Ximiao, Chief Researcher at China Merchants Union, urges establishing sustainable capital replenishment mechanisms, suggesting measures like extending special bond tenures, tailoring special treasury bond allocations, streamlining equity fundraising approvals, and accelerating listings for qualified regional banks.