Research On The Transformation Of Profit Model About Small And Medium Commercial Bank In The Context Of Interest Rate Marketization In China

Since the liberalization of interbank offered rate in 1996,China has officially launched the prelude to the reform of interest rate marketization.After long-term efforts,in July 2013 and October 2015,the control of loan interest rate was abolished,and the floating ceiling of deposit interest rate was liberalized.These two measures marked the completion of the market-oriented reform of interest rate in China.The gradual market-oriented reform which lasted for several years has provided a transitional time for the improvement of China's regulatory mechanism and the adaptation of commercial banks to the new economic environment.Commercial banks,as financial institutions directly priced by interest rates,the reform of interest rates will inevitably have an impact on their profitability.Under the marketization of interest rates,interest margins are gradually narrowing.It is imperative for commercial banks to adjust their profit model of earning huge interest margins simply by expanding their deposit and loan businesses.At present,China has formed a multi-level large,medium and small commercial bank system with five main acts,followed by the national joint-stock banks,and numerous urban agricultural and commercial banks.In view of the large-scale assets of large commercial banks,a variety of business types and strong risk resistance,this paper focuses on small and medium-sized banks.Based on the data of 19 listed banks,including 8national joint-stock commercial banks and 11 city commercial banks,this paper studies the profit model transformation of small and medium-sized commercial banks under the background of interest rate marketization.By analyzing the income structure and business structure of joint-stock commercial banks and city commercial banks,it is found that with theadvance of interest rate liberalization,interest net income has become unstable,and the expansion of banks can no longer guarantee the growth of net interest income.At present,the profit models of small and medium commercial banks have the following characteristics: the profit mode is relatively simple,interest income is relatively high,and credit is relatively high.High asset allocation,poor risk tolerance;unbalanced business structure,low level of development of intermediary business.Next,through the growth of net profit,the change of asset profit margin and the rise of non-performing loan rate,we find that the existing profit model is not suitable for the development of interest rate marketization.Then through the empirical analysis of the data of 19 Listed Small and medium-sized commercial banks from2012 to 2018,it is concluded that the net interest margin has a significant impact on the proportion of non-interest income.The marketization of interest rate will promote joint-stock banks and city commercial banks to enrich their income sources,develop non-interest business and change their profit model.Based on the empirical results,this paper points out that small and medium-sized commercial banks should transform their profit model.Finally,it puts forward some countermeasures and suggestions.Small and medium-sized commercial banks should choose a differentiated transformation path according to their own advantages,transform joint-stock commercial banks to the direction of balanced development of income structure,and develop non-interest business appropriately for City commercial banks to gradually transform.We should improve the pricing mechanism of products adapted to the background of interest rate marketization from two aspects: deposit products and loan products.Facing the fluctuation of interest rate,we should strengthen the control of interest rate risk and enhance the ability of management risk control.Strengthen technology investment and personnel training,and improve the relevant supporting safeguards for the transformation of profit model.