Empirical Study On The Impact Of LPR Reform On The Performance Of Listed Commercial Banks In China

On August 17,2019,the People’s Bank of China issued an announcement on the reform and improvement of the base loan interest rate(hereinafter referred to as the "LPR")formation mechanism,adopting the new quotation principles,formation methods,maturity varieties,quotation banks and quotation frequency,which has a positive significance for further promoting the marketization of loan interest rate.In recent years,the operating profits of commercial banks have changed constantly because of the financial market policy reform.The market-oriented reform of the loan interest rate mainly aims at the adjustment of the loan interest rate in the financial market,which brings certain pressure to the profit level of commercial banks and affects the overall performance of commercial banks.On this basis,the academic circle and practical circles believe that the marketization reform of loan interest rate has affected the profits of commercial banks to a certain extent,and has somewhat hindered the commercial banks to expand their operation scale and enhance their international competitiveness.Therefore,this paper hopes to verify that through theoretical and empirical analysis,the marketization reform of loan interest rate will have favorable and adverse effects on the development of commercial banks through theoretical and empirical analysis,and aims to promote the internal system reform of commercial banks and promote the development of commercial banks in a sustainable and long-term direction.This paper analyzes the impact of LPR reform on the performance of commercial banks from the perspective of theory,and obtains a series of research conclusions mainly through the event analysis method,correlation analysis and linear regression analysis.The details are as follows:First,from the perspective of event research method,LPR reform will significantly affect the performance of listed commercial banks,and the performance of listed commercial banks after LPR reform is significantly lower than that before LPR reform.Second,according to the results of the correlation analysis,the Pearson correlation coefficient between the performance of listed commercial banks and LPR was 0.379,and the correlation coefficient passed the two-tailed test at the 5%significance level,indicating that there is a significant positive correlation between the performance of listed commercial banks and LPR.Third,from the regression analysis,LPR change has a linear impact on the performance level of listed commercial banks,that is,LPR change has a significant positive impact on the performance of listed commercial banks,which complies with the research hypothesis 1 of this paper.At the same time,the relationship between LPR mechanism and the performance of commercial banks is non-linear,that is,in the short term,LPR mechanism will have a negative impact on the performance of commercial banks,but in the long term,it is conducive to the stable development of commercial banks,and LPR mechanism has a U-shaped relationship on the performance of commercial banks.