Innovation Strategy Of Financial Intermediary Base On The Mechanism Of Financial Disintermediation

Traditional Theories hold that, financial intermediary facilitates the issue of financial securities and their transformation from issuers to the investors. This is called financial intermediation. With the development of direct financing, commercial banks lost their dominating position in financing, and their interest incomes declined and cannot survive the tough competition only with their traditional deposit and loan business. This crisis is "Financial Disintermediation ".Studies show that, commercial banks in the market economy courtiers will sooner or later come up with Financial Disintermediation. To overcome this crisis, they have to open their innovation business, and financial department, financial supermarket come into being. By these means innovation business becomes dominating business instead of traditional business. But there still some countries that have not go through infections brought by Financial Disintermediation.Data shows, with the full development of Chinese financial industry. The Chinese commercial banks are facing the problem of financial disintermediation. Although its infection is not serious right now, we should still give our focus on it. So the study of the mechanism of financial disintermediation, especially the mechanism in Chinese situation, and find out the innovation strategies is important.According to the macro aspects, the living and developingenvironment of global financial industry has changed a lot. These changes show in the developing sequence, financial laws and regulations, financial technologies and so on. All these contribute to the external reasons of financial disintermediation. Meanwhile, according to the micro aspects, with the development of direct financing market, the changes in thefinancial conceptions of enterprises and residents, commercial banks must change their focus from big customers to middle and small customers. Commercial banks must change their operating ways and develop to a higher stage.The main reason of financial disintermediation is the customers find better products and service in the direct financial market or other financial institutions.So commercial banks must innovation. Before that they should ask themselves four questions. "How to create more values for the customers", "What can we provide to our customers", "What do the customers need" and "Who are our customers". The innovation strategy against financial disintermediation is an integrated system composed of value chain and value triangle innovation, financial products and service innovation, demand strategy innovation and customer developing strategy innovation.