A Study On The Profit Model Transformation Of China’s Commercial Banks Under The Interest Rate Marketization

China’s pace of interest rate marketization reform since 1996 has been determined to move forward. In 2014, the government canceled the commercial bank lending lower bound, marking China’s market-oriented interest rate reform has a breakthrough. Full implementation of interest rate marketization, as a major change in China’s financial industry, will fundamentally change the operating mechanism of China’s financial markets to make money in circulation to obtain more effective configuration. Commercial banks in the financial system as an important part are greatly influenced by the impact of the interest rate marketization. Interest rate market-oriented reform of China’s commercial banks is a double-edged sword, on one hand allows financial institutions to better serve the real economy, forcing commercial banks in terms of business, products, customer service, accelerate innovation; on the other hand will make the deposit and lending interest rate of commercial banks declined, reducing profit growth, making the traditional profit model adversely affected by the financial market and fully exposed to the problem of its business management. At present, China’s commercial banks are still lending and deposit interest rate returns are the major source of profit. The business structure of the traditional credit business is still based on the main profit model and profitable homogenization phenomenon is facing more obvious competition. Commercial banks relying on traditional business profit model no longer meet the interest rate market financial environment. How to achieve transformation profit model is a major issue each commercial bank must face.The article first reviews the history of the domestic interest rate market, analyzes the current domestic commercial banks profit model and the upcoming challenges after the full liberalization of the market. Based on the interest rate marketization, I choose the Minsheng Bank as a research object, building evaluation index system with Minsheng Bank profitability evaluation methods by expert consulting, analytic hierarchy process and fuzzy mathematics method to evaluate Minsheng Bank profitability. Results of the study show that the Minsheng Bank is currently located in the middle level of profitability evaluation system and the need for transformation of the profit model to promote the sustainability of its profitability is improved. Finally, for Minsheng Bank’s profit model, we give suggestions on how to deal with the current market interest rate changes and restructuring. Minsheng Bank should improve the external policy environment with its own operating environment combined with the integration of existing resources, adjust the assets and liabilities, income structure, improve the pricing ability of products, improve risk management, increase technology and products innovation, open up new revenue streams. In other words, it should not only protect the traditional profit model on a pace of steady development, but also accelerate the differences in management.