A new round of capital replenishment for major state-owned banks is about to begin. On May 22, the issuance of 300 billion yuan in special treasury bonds was officially launched to support these banks in bolstering their capital bases.

This year's Government Work Report explicitly outlined plans to issue 300 billion yuan in special treasury bonds aimed at supplementing the capital of large state-owned commercial banks. Recently, the Ministry of Finance disclosed arrangements for the issuance of general and special treasury bonds in 2026. According to the issuance plan, the 300 billion yuan special treasury bonds for capital injection into central financial institutions will be issued in two tranches. The 5-year tranche commenced issuance on May 22, with the 7-year tranche scheduled for June 12. Interest payments will be made annually.

This marks the second round of "collective capital replenishment" for state-owned banks. In 2025, the Ministry of Finance issued 500 billion yuan in special treasury bonds, which were directed as capital injections into four major state-owned banks: Bank of China, China Construction Bank, Bank of Communications, and Postal Savings Bank of China. By the end of June last year, these four banks had collectively raised approximately 520 billion yuan through private placements of A-shares to specific investors.

Based on last year's capital injection pattern, the 500 billion yuan was distributed among the aforementioned four banks. Industry insiders anticipate that this year's 300 billion yuan "capital package" will be precisely allocated, most likely to Industrial and Commercial Bank of China and Agricultural Bank of China, which did not receive targeted capital injections last year.

Reflecting on the implementation pace of the previous round, the 2025 special treasury bond capital replenishment initiative was characterized by "rapid deployment and high efficiency." By the end of March 2025, the four major banks collectively announced private placement fundraising plans. In less than three months, all funds were successfully secured by late June.

Adequate capital is the lifeline for the stable operation of state-owned banks and serves as the foundation for their ability to support national strategies. China's six major state-owned commercial banks are all domestically systemically important banks. Among them, Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, and Bank of Communications are designated as global systemically important banks (G-SIBs), subject to stricter capital regulatory requirements and facing ongoing capital adequacy pressures. According to regulatory stipulations, the core tier 1 capital adequacy ratio "red lines" for these five state-owned banks are 9.5%, 9.0%, 9.0%, 9.0%, and 8.5%, respectively. These stringent standards impose higher demands for regularized and institutionalized capital replenishment.

From the perspective of industry professionals, the capital injections via special treasury bonds can effectively enhance the core tier 1 capital of state-owned banks, comprehensively strengthening their risk resilience and capacity to serve the real economy.

It is noteworthy that following the first round of special treasury bond capital injections in 2025, the capital metrics of the four recipient banks showed significant improvement. According to their 2025 annual reports, the core tier 1 capital adequacy ratios of Bank of China, China Construction Bank, Bank of Communications, and Postal Savings Bank of China were 12.53%, 14.63%, 11.43%, and 10.53%, respectively. These figures represent increases of 0.33, 0.15, 1.19, and 0.97 percentage points compared to the end of 2024, all exceeding their respective regulatory "red lines."

In contrast to the four banks that have already received capital injections, Industrial and Commercial Bank of China and Agricultural Bank of China have yet to benefit from targeted treasury bond capital replenishment. However, both banks currently maintain solid capital fundamentals. Data from their 2026 first-quarter reports show that as of the end of March 2026, the core tier 1 capital adequacy ratios of Industrial and Commercial Bank of China and Agricultural Bank of China were 13.26% and 10.80%, respectively. Industry analysts believe that if the 300 billion yuan special treasury bond capital injection materializes this round, the core capital strength of these two banks will be further bolstered.

"300 billion yuan in capital could potentially leverage asset expansion of approximately 4 trillion yuan, enhancing capabilities for direct credit provision and external mergers and acquisitions, thereby robustly supporting the real economy and mitigating financial risks," according to calculations by China International Capital Corporation (CICC).