China's Listed Commercial Banks Non-interest Income Empirical Study Of Performance Of The Bank

For a long time, interest income has been the main source of profit for China’s commercial banks. However, under conditions of full liberalization of domestic financial markets, the traditional credit business of commercial banks have been faced with severe challenges, so increasing non-interest income business and improving the proportion of non-interest income to operating income have become China’s commercial banks’new directions for business strategy transformation.It is the era of flourishing contributes to the traditional view that developing non-interest business helps to improve bank profitability and enhance operating stability. However, It is still worthy of study the relationship between non-interest income and bank profitability Some scholars believe that the development of non-interest income in favor of a stable banking revenues and a better bank performance. On the contrary, some others hold the opposite view. So, it is necessary to do in-depth discussion of the effect of non-interest income.From the theoretical and empirical perspectives, this article studies how China’s commercial banks non-interest income influences bank’s benefit result, combined with the qualitative and quantitative analysis. First, selecting qualitative analysis and statistical analysis to study the bank’s current revenue sources and structure of five state-owned commercial banks and seven joint-stock commercial banks, then compare the result of two banks, based on domestic and foreign previous studies of the theme that how banks’ non-interest income influences bank’s benefit result; second, this paper uses panel data model and quantitative analysis to study the effect of non-interest income on commercial banks’ performance in state-owned commercial banks and joint-stock commercial banks relatively, while comparing the result of two banks. Regression analysis showed that there is no significant correlation between the overall non-interest income and the benefit result of the two kinds of commercial banks. But as for the constitution of income, the correlation between fee and commission income share and ROA is significantly positive, whiie the correlation between share of other non-profit income and ROA is significantly negative. Finally, based on the above empirical results,this article proposes some recommendations of developing China’s commercial banks non-interest business.