Reserch On The Impact Of Diversification Of Commercial Banks On Their Performance

Chinese banks explore the transition and upgrading in the time of rapid economic developing and financial deepening for nearly a decade.Under the background of interest rate liberalization,Banking has repeatedly stressed the adjustment of business structure,and no longer limited to traditional businesses.Then the emergence of financial disintermediation,the internet finance,cloud computing and big data,which lead to financial exchange continue to disintermediation.And all of these bring tremendous pressure to banks.Banks should reform and innovate actively,and many banks select the diversification of intermediary business.After the financial crisis,banks are highly concerned about risks,and especially to the system risk.Besides,the Basel Committee has imposed new restrictions on capital regulation.So risk and performance become the dilemma of commercial banks.If blindly pursuing performance will brings inevitable risks,but blindly avoid risk will reduce performance.This has aroused banks' renewed thinking:should banks choose diversification?How to select the diversification business?How to adjust the business structure?How to avoid the risks of diversification business?Etc.There is the persistent research topic of commercial banks diversification influence the performance,but there have many difference ideas to this topic.In particular,if we can refine the real impact of business diversification on performance in recent ten years,which will be useful to banking.This article is based on the topic of business diversification,and separately from the asset diversification,debt diversification and off-balance sheet diversification three aspects to divide the banks diversification.Then the article use the factor analysis way to calculate the 22 commercial banks' business performance,and select the HHI to calculate the banks' diversification degree.And based on the banks' heterogeneity to research the impact of banks' business diversification on their performance.The main conclusion in this paper are presented:(1)The performance score of Joint-equity commercial banks and urban commercial banks are higher than Big national banks.(2)The Big national banks and urban commercial banks concentrate on the asset diversification and off-balance sheet diversification,but the joint-equity commercial banks pay more attention to the debt diversification.(3)The diversification of assets of listed banks and ono-listed banks have no significant negative impact on the performance,and the impact of listed banks is greater;The diversification of debts of listed banks have significant positive impact on the performance,but the diversification of debts of list banks have no significant positive impact on the performance;The diversification of off-balance sheet of listed banks and ono-listed banks have significant negative impact on the performance,and the impact of non-listed banks is greater.(4)The diversification of assets of state-owned banks have significant positive impact on the performance,and joint-equity banks and urban banks have significant negative impact on the performance;The debt business diversification of state-owned banks have a significant negative impact on the performance,and joint-equity banks have significantly positive impact,the negative impact of urban commercial banks is significant;The off-balance sheet business diversification of state-owned banks have no significant positive impact on the performance,and joint-equity banks have significantly positive impact,the negative impact of urban commercial banks is not significant.(5)When two kinds of heterogeneity coexist,the diversification of assets of listed state-owned banks have significant positive impact on theperformance,and listed joint-equity Banks and listed urban commercial banks also have significant negative impact,but unlisted joint-equity banks and unlisted urban banks have opposite results.The diversification of debt of state-owned banks have significant negative impact on the performance,and the listed joint-equity banks have more significant positive impact than unlisted joint-equity banks,and unlisted urban banks have more significant negative impact than listed urban banks.The diversification of off-balance sheet of state-owned banks have positive impact on the performance,and the unlisted joint-equity banks and unlisted urban banks have negative impact on the performance than the listed joint-equity banks and listed urban banks.