Analysis On The Pofit Determinant Of The Private Banking Business In China

With China's rapid economic growth, there're more and more wealthy people, whose wealth is rapidly expanding. The need of personal financial management, asset management and other financial service requirements of this group become diversified and individualized. Private banking focuses on wealth management, and offers a series of top professional financial services for the group of high net worth people. As the country has accumulated a certain amount of customer resources in recent years, domestic and foreign banks have moved into private banking for the following two reasons. One is for the development of their business to meet the practical needs of retail banking in transition, and another reason is due to external pressure of competing for high-end customers. As private banking faces many problems and challenges, it is of realistic significance to study how domestic Chinese commercial banks should conduct private banking business.This article will focus on how to improve the profitability of private banking business through in-depth discussion. First, by analyzing the market potential of domestic and international private banking and wealth management, we reveal the internal and external environments of the private banking business. Second, by analyzing the profitability of Chinese banking sector, we analyze the profitability of different Banks to identify key factors determining their private banking profits, offer proposals for the development of domestic private banking, promotion of sustainable and profitable business models, and acceleration of the process of becoming profitable for the domestic private banking business.In this paper, the profitability of private banking theory and research are combined with the use of private banks to further deepen the research in the domestic commercial bank.