Four of China’s largest state banks plan a total of up to $72 billion in private placements to boost core tier-1 capital, after Beijing pushed for stronger buffers for lenders to better support the economy.

Bank of Communications Co. will sell up to 120 billion yuan ($16.5 billion) of A shares in a private placement to investors including the Ministry of Finance, according to a Sunday filing. Bank of China Ltd., Postal Savings Bank of China Ltd. and China Construction Bank Corp. plan placements of 165 billion yuan, 130 billion yuan and 105 billion yuan worth of A shares respectively to the finance ministry and other investors, according to separate filings.

China’s finance ministry is a major shareholder in all of the state lenders.

The announcements follow Chinese authorities’ pledge in early March to issue 500 billion yuan in special sovereign bonds to replenish capital at the nation’s biggest state-owned banks. The plan to help out the lenders was first flagged as far back as September and the government later said it would tap the notes to fund the injections.

China is beefing up the strength of its banking system — even though the top six lenders have capital levels that exceed requirements — after enacting a string of stimulus policies including cuts to mortgage and policy rates.

Enlisted to support the economy over the past few years, the lenders are battling record-low margins, slowing profit growth and rising bad debt. The sector’s net interest margin — a gauge of profitability — had slipped to 1.52% at end-2024, the lowest ever.

Stronger capital buffers will allow lenders to potentially provide more loans as Beijing vowed greater support for sectors from property to consumer and technology to achieve a growth target of about 5% this year. It’ll also serve China’s purpose to maintain financial stability and keep risks in check, while it contends with both domestic woes and tariff shocks from the US.