Several of the biggest banks in China are set to cut deposit interest rates on Friday, a move that will likely lead to a reduction in the loan prime rates, or LPRs, — the benchmark lending rates — early next year, according to media reports and people close to the matter.

On Friday, the Industrial and Commercial Bank of China will cut interest rates of one-year time deposits by 0.1 percentage point to 1.45 percent, and two-year time deposits by 0.2 percentage points, to 1.65 percent. Three-year and five-year deposit rates will be cut by 0.25 percentage points, China Central Television reported on Thursday.

China Construction Bank, Bank of China, Agricultural Bank of China, and Postal Savings Bank of China will also cut deposit rates on Friday, with multiple joint-stock commercial banks set to follow suit, the report said.

An unnamed source from a joint-stock commercial bank confirmed the information to China Daily. "The cuts will be announced on Friday," said the source.

After major commercial banks cut deposit rates in September, Yang Haiping, a researcher at the Central University of Finance and Economics' Institute of Securities and Futures, said the latest round of deposit rate cuts will create the room for LPRs to decline next year.

LPRs remained steady on Wednesday, with the one-year LPR standing at 3.45 percent and the over-five-year LPR at 4.2 percent.

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