The Middle Of The State-owned Commercial Banks Business Transformation

Since 1970, the development of financial market and information technology caused the institutional arrangements of integrated function in the traditional banking industry to lose the competitive advantage gradually. Facing the survival crisis, West Commercial banks use their advantages of prestige, fund and technology to promote the intermediary business innovation which made the non-interest income grow faster so as to compensate for the decay of traditional business. Intermediary business transformation becomes the developing tendency of the world banking industry.The intermediary business does not appear in balance sheet, forms the non-interest income and is one of the three important business for modern commercial banks along with the traditional asset and liability business. Following the market economic reform of China, especially when we join WTO, the state owned commercial banks are inevitably under great competitive pressure. Therefore, the government decided to implement the general reform in order to transform state owned commercial banks into modern banks with sufficient capital, effective internal control system, secure operation, and excellent performance.Through the institutional reform from 2003, the state owned commercial banks improved their capital sufficient level and established the modern company governance structure, but their weak points are still obvious. The traditional business pattern of the state owned commercial banks, which is labeled by the expansion of credit scale, will lead to potential operational risks. Facing transformation tendency of commercial bank evolving from financial intermediary to service intermediary, the state owned commercial banks should optimize the business structure and diversify the source of income, which is also the necessary choice to promote the general reform. As the important content of general reform, the intermediary business transformation is important for the state owned commercial banks to consolidate equity reform achievement, reduce operational risks, overcome self frangibility, resist the property bubble and transform from scale guidance to value guidance.Using the standard analysis and the empirical analysis method, I study the process of the intermediary business transformation of western commercial banks and the environment of our state owned commercial banks, in order to give reasonable illustration and innovative advices. First of all, from the fragility of traditional banking industry and its negative external effects, I study the process of western commercial banks and define the meaning of intermediate business transformation. Second, followed by analysis the relation between institutional reform and intermediary business transformation, I point out that innovation is the endogenous impetus for state-owned commercial banks to carry out intermediary business transformation. I also do empirical analysis on the macro factors and micro factors which influence the intermediary business transformation. Third, the paper point out the innovative transformation strategy, including product designing, pricing and services mechanism innovation. Finally, by summarizing the risk management experience of western commercial banks, I declare the internal and external risk management strategies on intermediary business transformation for Chinese state owned commercial banks.Regarding the above questions, the paper makes efforts on several aspects to carry on innovation: First, analyze the cause of intermediary business transformation in commercial banks and point out that the inherent vulnerability of the traditional banks and its negative exterior effects, promote commercial banks to pursue development through intermediary business transformation. Second, from the double visual angle of transformation and development, I study the relation between institutional reform and intermediary business transformation. Third, induce the intermediary business transformation experience of the west commercial banks, make comparison between west commercial banks and our state owned commercial banks, and use board data and time series methods to analyze the influencing factors in the intermediary business transformation of our state owned Commercial banks. Fourth, based on the innovation economic theory, analyze the inner motive effect of the intermediary business transformation and declare the intermediary business transformation innovation motive model, enhancing the study on the intermediary business transformation of the state owned Commercial banks to a new level.