330 Million Trillion Wealth Management Products Switch to "Performance Benchmark" Leaving Investors Confused

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As an investor with 8 years of financial management experience, Liu Jing says she now really can’t understand the latest performance benchmark for financial products.

In late February 2026, a fixed income financial product she purchased with daily opening was due. When she was about to reinvest, she found that the performance benchmark of a product she previously liked had been adjusted from 2.40% to “20%×Current Deposit Rate + 80%×CFA0-3 Month Treasury Bond Total Return Index.”

“What is the CFA 0-3 Month Treasury Bond Total Return Index? Is its future trend upward or downward?” Liu Jing asked with confusion.

She doesn’t know whether this product can still deliver the expected 2.40% annualized return. So she decided to switch to other financial products. However, she found that many products’ performance benchmarks had quietly been adjusted: from a single fixed value (e.g., 2.30%) or a range (e.g., 2.20%–2.80%) to a “linked to an index.”

Faced with the new performance benchmarks, she found it difficult to judge the expected returns of these products and didn’t know how to choose.

At this point, she may not realize that the financial product industry is experiencing a collective “re-anchor” of performance benchmarks.

After the Spring Festival, many bank wealth management subsidiaries have successively adjusted their product benchmarks.

By the end of February, Everbright Wealth Management adjusted the benchmark of Sunshine Jin Tian Li Half-Year Profit No. 2 from 1.80% to “CBA00113.CS—CFA—New Comprehensive Full Price (Less Than 1 Year) Index Return.”

In early March, Xingyin Wealth Management adjusted the benchmark of the fixed income product “Wen Tian Plus Daily Income Increase No. 109” from an annualized 1.15%–1.95% to the 7-day notice deposit rate.

Chen Jian, head of product department at a bank wealth management subsidiary, told Economic Observer that the “Banking and Insurance Institution Asset Management Product Information Disclosure Management Measures” (hereinafter referred to as “Measures”) will officially come into effect on September 1, 2026. The Measures stipulate that asset management product managers should maintain the continuity of product benchmarks and generally should not adjust them.

Chen Jian said, “This means that the previous practice of bank wealth management subsidiaries frequently adjusting benchmarks following market fluctuations is becoming increasingly difficult. To reduce passive adjustments, financial products can only abandon fixed single values or ranges and instead adopt index-linked or market rate plus points methods.”

Deeper reasons lie in the fact that in a low-interest-rate environment, the actual yields of fixed income products have become difficult to reach the originally set single or range benchmarks, leading to a decline in benchmark achievement rates. To reverse this, bank wealth management subsidiaries are “making moves” in adjusting benchmarks, effectively lowering them to improve the product’s benchmark achievement rate (i.e., actual returns exceeding the benchmark), thereby conveying a more sustainable investment confidence.

What surprises the industry even more is that this collective “re-anchoring” not only presents new challenges at the sales end but also causes chain reactions in asset allocation.

Re-anchoring in progress

Chen Jian told reporters that the benchmarks roughly fall into four types: first, single fixed values; second, ranges; third, market rate plus points, such as “1-year fixed deposit rate + 0.60%”; and fourth, index-linked, such as linked to the CSI 300 or CFA—CFA—New Comprehensive Full Price (Less Than 1 Year) Index.

Previously, bank wealth management subsidiaries preferred setting higher fixed or range benchmarks to enhance product marketing effectiveness.

In January 2026, the China Banking Wealth Management Market Annual Report (2025) issued by the Bank of China Wealth Management Registration and Custody Center showed that by the end of last year, there were 46,300 existing wealth management products with a total scale of 33.29 trillion yuan.

Chen Jian found that over 80% of existing products used fixed or range benchmarks. Clearly, higher and more definite “values” are easier to attract investors.

However, the “Measures” issued in June 2025 (Draft for Comments) restrict this strategy. It stipulates that product managers should maintain the continuity of benchmarks and generally should not adjust them.

After the “Draft for Comments” was issued, Chen Jian’s bank wealth management subsidiary held intense discussions. The product department argued that to cope with declining yields of fixed income assets, they previously could frequently lower benchmarks—last summer, they adjusted several fixed income products’ benchmarks from 2.80% to 2.50%. But with the new regulation, this approach faces compliance risks. Therefore, they suggested switching these benchmarks directly to “linked to the CFA—CFA—New Comprehensive Full Price (Less Than 1 Year) Index.”

To persuade the bank’s wealth management subsidiary to agree, the product department listed the advantages of index-linked benchmarks, including better alignment with actual investment strategies and market trends, fewer adjustments needed, and compliance with regulatory requirements for benchmark continuity.

However, this suggestion was not adopted. Senior management believed they could wait until the new regulation officially took effect before uniformly adjusting benchmarks.

Chen Jian analyzed that the company still hopes to promote sales and expand assets under management by maintaining higher fixed or range benchmarks.

In the second half of 2025, Chen Jian participated in creating and issuing over 90% of short-term fixed income products, which still set benchmarks at 2.50% or 2.20%–3%, achieving sales beyond expectations.

But problems soon emerged.

After the Spring Festival in 2026, some distribution channels reported that the actual maturity yields of these short-term fixed income products were only about 1.80%, failing to meet the benchmarks, with complaint rates increasing by over 20%.

Chen Jian explained that the main reason was the continuous decline in yields of fixed income assets, widening the gap between actual yields and benchmarks.

According to the “China Banking Wealth Management Market Annual Report (2025),” due to declining yields of fixed income assets, the average yield of wealth management products in 2025 was only 1.98%. In contrast, benchmarks for fixed income products issued in 2025 were generally set between 2.20% and 2.50%.

Chen Jian took several remedial measures, such as adding IPO (initial public offering) strategies to “Fixed Income+” products. Despite securing allocations in popular new stocks, the low proportion of IPO investments meant only an extra 10 basis points of performance was added, with the maximum actual yield at maturity reaching 1.90%, still below the original benchmark of 2.50%.

Starting in March, Chen Jian’s bank wealth management subsidiary decided to “re-anchor” benchmarks—requiring product departments to switch fixed income benchmarks from fixed or range values to market rate plus points or index-linked by September this year.

“On the surface, this is to complete the benchmark adjustment before the September implementation of the ‘Measures.’ But more importantly, the bank’s wealth management subsidiaries need to reconstruct the benchmarks for fixed income products to address the large gap between actual yields and benchmarks,” Chen Jian said.

After adjusting the benchmarks of several cash management products from 1.65% to “7-day notice deposit rate of the People’s Bank of China” (currently 1.35%), Chen Jian said this adjustment gives the investment team more confidence to achieve actual yields exceeding benchmarks in a declining interest rate environment, thus improving the overall benchmark achievement rate of the company’s products.

Investors “can’t understand”

Recently, Liu Jing has been complaining that she increasingly cannot understand the “return expectations” of financial products.

In the past, when she saw fixed income products with benchmarks of 2.30% or 2.20%–2.80%, she felt confident about the future returns; now, when the benchmark switches to the CFA 0-3 Month Treasury Bond Total Return Index, she suddenly doesn’t know how to estimate the product’s future yield.

She called the bank’s customer service for answers, but the staff also couldn’t explain clearly. When asked about the “future trend of the CFA 0-3 Month Treasury Bond Total Return Index” or whether the actual returns of the product could beat this index, the customer service staff hesitated and couldn’t give a definite answer.

Eventually, Liu Jing decided to switch to another bank, purchasing a fixed income product still marked with an “annualized 2.40%” benchmark.

Liu Jing believes that the benchmark of a financial product should be highly recognizable, allowing residents to see at a glance and feel assured to subscribe.

Similarly, Qin Hui, a wealth manager at a large state-owned bank branch in East China, faced similar frustrations.

After many fixed income products’ benchmarks changed to the CFA—CFA—New Comprehensive Full Price (Less Than 1 Year) Index or CFA 0-3 Month Treasury Bond Total Return Index, Qin Hui had to explain many questions he himself didn’t fully understand, such as the underlying assets of these bond indices, their future trends, and why these two bond indices were chosen as benchmarks.

Qin Hui said he had provided feedback to the product managers of the bank’s wealth management subsidiaries. He also couldn’t give a clear prediction of the future movement of the bond indices.

What troubled him more was that after the Spring Festival, over 20 investors transferred their funds to other banks to subscribe to fixed income products still benchmarked at 2.30% annualized.

The reason was that these investors believed benchmarks should be “concrete,” preferably clear values or ranges, so that future returns are “easy to see at a glance.”

Qin Hui admitted that it takes time to educate investors and help them adapt to the new benchmarks. During this process, banks need to further improve the transparency of index-linked benchmarks, so that residents can understand the future trends of the underlying bonds and stocks, forming a more comprehensive and clear view of potential returns. With better informed rights, residents will be more willing to invest.

In mid-March, during a training session held by the bank’s wealth management subsidiaries, Qin Hui suggested that in product promotion materials, banks should clearly state the historical performance of the bonds and stock indices linked to the benchmarks under different market conditions, the underlying assets of these indices, and the specific reasons for choosing these indices as benchmarks. This would help bank wealth managers better introduce these indices and the future investment returns of related products.

Shaking up the investment side

What bank wealth management subsidiaries didn’t expect was that this “re-anchoring” also caused a “shock” to asset allocation strategies.

Zhang Jie, head of the investment department at a joint-stock bank, said that after the benchmark “re-anchoring,” his asset allocation operations suddenly faced invisible constraints.

After the Spring Festival, he adjusted a “Fixed Income+” product’s benchmark from 2.50%–3.50% to a composite index: “CFA New Comprehensive Wealth (1–3 years) Index Return × 90% + PBOC 7-day notice deposit rate × 5% + Nanhua Commodity Index (NH0100.NHF) × 5%.”

After the switch, Zhang Jie found that his ability to allocate a higher proportion to commodities was more restricted. Previously, if he believed commodities would rise significantly, he would allocate 10% to gain excess returns; now, with the new benchmark, his risk control department opposed this, fearing that if commodity prices suddenly fell, the product’s net value would drop sharply, making it difficult to meet the benchmark and increasing redemption and complaint risks.

Therefore, the risk control department advised him to strictly follow the “three major index weights” of the new benchmark, limit the maximum commodity investment to 5%, and ensure that this part of the investment outperforms the Nanhua Commodity Index, avoiding risky investments.

“After the benchmark re-anchoring, I feel more constrained in my investments,” Zhang Jie said. But he also understood the risk control considerations: according to the “Measures,” if a product cannot meet the benchmark for a long time, it might be considered non-compliant in disclosure or unreasonable in benchmark setting, which could negatively impact the bank’s related business.

Similar investment dilemmas also occurred with Dai Feng.

As a manager of equity investments at a joint-stock bank’s wealth management subsidiary, he managed two equity products whose benchmarks changed from an annualized return of 5%–8% to the “CSI Dividend Index.”

However, the senior management also set another performance requirement: during market downturns, the investment return of these equity products must be above 0%; during market upswings, they must outperform the CSI Dividend Index.

Dai Feng said that during market declines, his equity allocation strategies would face greater tests, because his goal was not to minimize losses relative to the CSI Dividend Index, but to avoid losses altogether.

“I need to focus more on safety. When the equity prices exceed my reasonable valuation, I will decisively take profits,” he said, which might cause him to miss opportunities for excess returns.

He also suggested adding a new benchmark for equity products—such as annualized absolute return or maximum drawdown—to better demonstrate the products’ resilience and high-yield potential, as well as the investment manager’s actual skill.

However, the senior management did not adopt this suggestion, citing that most residents might not understand the value of such indicators and might perceive the products as lacking clear return expectations.

Zhang Siyuan, a special researcher at Su Commercial Bank, believes that the re-anchoring of benchmarks behind the scene aims to guide more products toward index-linked or market rate plus points benchmarks, more accurately reflecting the underlying asset return characteristics, reducing deviations between expected and actual returns, and shifting the competitive logic from “benchmark attractiveness” to the core investment management capabilities. This will promote the focus of wealth management subsidiaries on asset allocation skills and accelerate the industry’s shift toward client-centered wealth management.

(At the respondent’s request, Chen Jian is a pseudonym.)

(Author: Chen Zhi)