Study Of Off-Balance-Sheet Activities Development For Chinese Commercial Banks

The development of Off-Balance-Sheet Activities (OBSA) is one of the important trends in the international financial field. OBSA has become the third pillar of commercial banks business, except from the traditional two: the assets and liabilities business. In many western countries, the non-interest rate income from OBSA has approximately reached the amount from interest-related business.Comparatively, the OBSA of our commercial banks are still at a low level. Facing the pressure and challenge brought by further financial reform, interest rate marketization, securitization, and opening to foreign banks after our country entering into WTO, great efforts should be made in order to promote our banks OBSA.This paper employs methods of concluding, demonstrating, analyzing and comparing to investigate OBSA on background, reasons, influence and development strategies. The main contents of this paper are as follows:Firstly, this paper defines OBSA in both broad sense and narrow sense. This paper differentiates the OBSA and intermediary business. It is concluded that the conception of intermediary business is inaccurate.Secondly, this paper discusses the connection between OBSA and in-balance-sheet activities (asset and liability business), and the connection between financial innovation and OBSA. Also, this paper summarizes the reason for the rapid development of OBSA. Then the paper analyzes the passive and negative impact of OBSA both on banking and macro-economy.The third part of this paper shows the essentiality of expanding OBSA in domestic commercial banks. After analyzing the present situation of our OBSA and the reasons for the backward situation, the paper puts forward the covering strategies for our commercial banks OBSA, including the main OBSA product development , OBSA pricing , marketing and risk supervision.