Research On The Transformation Of Chinese Commercial Banks' Profit Model

The commercial banks of China have experienced three stages of long development,which refers to the system reconstruction,scale expansion,and reforms deepening.The commercial banks of China showed a flashy financial statement after the global financial crisis in 2008,which has hidden the fragility of the profit model.In long term,the main income of the commercial banks of China is the interest margin.It is very different from developed economies to the intermediate business income.Faced new challenges,the hidden risks for traditional profit model of the commercial banks begin to exposure.It has become an important topic for the banks to re-examine and reform the profit model.Focusing on this problem,the paper studies the logic by "asking questions,analyzing problems and solving problems".This paper based on summarizing relevant literatures from domestic and foreign studies,to re-examine the profit model of enterprise from the perspective of value creation,to figure out the main feature of traditional profit model,to point out the challenges that has faced,the profit model of commercial banks should be transformed from internal value chain to the integration of internal and external value chains.According to the theory,this paper analyzes the existing problems of the profit model in the commercial banks,and then puts forward the countermeasures and suggestions for the commercial banks of China.The main points of the thesis:the profit model of enterprise can be resolved from the logic of value creation process,the traditional banks mainly considering how to rely on internal resources to build the savings and loan business value chain,is hard to deal with new challenges such as economic development,technological progress,financial disintermediation,and customer demand differentiation,banks should transform to the integration coordinated internal and external resources of the profit model based on the modular value network.The characteristic of the profit model in existing Chinese commercial banks is the blinding pursuit of scale expansion and short-term profits after high economic growth,neglecting on customer needs,irrational business structure,departmentalization in resource allocation,rigid process design,performance evaluation without risky consideration.The thesis put forward the customers' needs,strengthening strategic management,modulating integration of internal and external resources,reducing capital occupied,optimizing business process and strengthening the risk evaluation of performance improvement plan.