A Study On The Profit Model And Profitability Of Village Banks In Guizhou Province

Our government always regard the rural area’s financial reform as the most important part in the rural reform. Nowadays, the large financial institutions increase the investment in the rural financial market. However, as far as the actual result of the rural reform in recent years is concerned, China’s rural financial market still has many urgent problems to be solved. There is a big gap between the supply and demand of rural capital. The reform of rural finance has become the key link of restricting the rural economic progress. As the most important part of the new type of the rural financial institutions in China, village banks bring new blood into the reform of the rural finance. Village bank achieved a little success during the past7years:the number of banks, the scale of development, governance structure, and risk control have made great progress. But, during the development of village bank, it also exposes a lot of problems:village banks easily loan but difficultly attract deposits; depends heavily on deposit interest rates, and risk management capacity needs to be strengthened.This paper has summarized domestic and oversea related literatures about the profit model and profitability of village banks. And then, the related basic theories of the paper are introduced. Base on that, the paper analyzes the concepts of the study. The paper analyzes domestic and oversea village banks’ successful profit models, and discusses the problems the villages banks must confront in Guizhou Province. What is more, Combined with the advantages and disadvantages of village bank profit characteristics and the traditional DuPont analysis system, the paper constructs a new DuPont analysis system which suits the analysis of village bank, discusses the profitability of X village bank, and analyzes the profitability and the management of risk between X village bank and The rural credit cooperatives. At last, the paper gets a reliable conclusion on the profit model and profit ability of village banks in Guizhou Province.The paper applies literature research and field research, quantitative and qualitative analysis, and finally forms three innovations:firstly, the paper improves the traditional DuPont analysis system; secondly, the paper has a new research angle; at last, the paper analyzes the village banks in Guizhou Province from quantitative analysis respective.