A Study On The Theory Of Deposit And Loan Pricing In China 's Commercial Banks

Although bank business is diverse and complicated, but we can give a simple and practical to illustrate the definition of a bank:"the bank is a mainly engaged in absorbing public deposits and lending institutions". While this definition is too simple, but this definition highlights the bank’s core business, the deposit and loan business. The contemporary theory of bank to bank functions is divided into four main categories: provide payment system; Asset transformation; Risk management; Information processing and monitoring borrowers. Of course this does not mean that every bank will have to perform above each kind of function. Commercial bank as financial enterprises, only with profit maximization as the goal, in order to survive and develop in the competition. And our country commercial bank’s profit comes mainly from interest income, interest income in the interest rate as the direct value of deposit and loan pricing. So sure the bank in the process of marketization is the interest rate for the reasonable pricing advantage of major initiatives.In 2014 central economic work conference pointed out that China’s economic development will be in the new normal. The economic slowdown in China, the opportunity lies in the innovation and transformation, a larger impact on traditional industries, and the banking industry as a traditional industry of the financial system in our country, how to cope with the new norm and is particularly important. In recent years, our country commercial bank assets and liabilities of the term structure by investment demand and consumption of consumer preferences change, lead to commercial bank interest rate term mismatch problems become more prominent. In China has promoted the economic freedom and restart the circumstances of interest rate liberalization, this paper is intended to break the original passive pricing by government oligopolistic mode, the bank will according to their own advantage to take active pricing of deposit, through the competition to maintain their own business deposit resources. Not only that, in addition to face more and more strong competitive pressure, in the past few decades in our country for national development strategy and the fragility of Banks, the banking sector set up strict access control, although has its reasonable elements, but not the corresponding negative effect. Especially the threshold access problems restrict the advance of interest rate marketization. Although in recent years, our country has made some efforts in open access bank, but there is no denying that the banking monopoly is not broken, high barriers to entry remain, bank access control is mainly manifested in setting up policy barriers.In view of the present situation, our country banking industry is still in the stage, the oligopolistic market and Monti-Klein behavior model as a kind of important analysis model, has experienced from the perfect competition, imperfect competition market, the analysis process of oligopolistic market. This paper mainly expounds from two aspects of internal factors and external factors:, because, through the study of the extension of Monti-Klein model, from the perspective of Banks to assess term risks affect the pricing problem of deposit and lending, points out that the inherent deposit-taking Banks need to change model to deal with the arrival of the marketization of interest rate; In terms of external cause, introducing regional Salop model illustrates the banking industry on the threshold of the access to the influence of the commercial bank deposit and lending pricing of interest rate liberalization, points out that appropriate to reduce barriers to entry is beneficial to promote the marketization of interest rate, promote the competitiveness of the banking sector. In this paper, the evolution process of the first chapter elaborated our country interest rate marketization, and sums up the modern commercial bank interest rate pricing theory; The second chapter the development of the savings and loan pricing at home and abroad as well as the historical evolution, pointed out from two aspects of internal external considering the savings and loan pricing theory; The third chapter from the our country commercial bank lending and deposit in the amount of assets and liabilities, the influence factors of structure analysis of the situation as well as interest rates and pricing method is discussed, due to confidential pricing related data belong to the commercial bank, and take basic theory analysis, the bank behavior in the analysis of the mainstream Monti-Klein model; Fourth and fifth chapter hypothesis under the condition of interest rate liberalization, Chinese commercial Banks respectively using Monti-Klein model and Salop model for internal term and external barriers to access to comprehensive analysis; And put forward corresponding internal and external causes in the sixth chapter comprehensive advice:term advice of internal factors,1. Improve the business level of managers minimize time limit management costs,2. widen the channel of the source of commercial bank deposit and lending channel,3. The use of big data processing mode in finding potential savings and loan customers; External factors threshold access advice, 1. The appropriate to reduce barriers to entry, cancellation, interest rate control is helpful to promote the marketization of interest rate,2. reduce the barriers to entry is beneficial to promote the transformation of commercial Banks,3. reduce the barriers to entry is conducive to the improvement of the financial institutions. Chapter 7 of this paper is summarized and prospected.