A Analysis On The Affect About The Chinese Interest Rate Marketization Reform To Commercial Bank

The international experience has proved that interest rate marketization (IRM) plays an important regulative role in realizing the internal-external equilibrium and insuring the effective allocating of financial resources and promoting the economic growth, etc. Relaxing the regulation and control on the capital price becomes an inevitable choice for the complete opening of China's economy. At present, the conditions facing China's IRM reform are basically mature. The fast growing of macro-economy and accelerating of financial institution reform, the improving standard of financial supervision and the existing relatively bigger gap between deposit and loan interest rate as well all create favorable conditions for IRM reform. Under such circumstances, the central bank(PBC) put forward the IRM reform idea which is "loans first, deposits later; bigger ones first, smaller ones later; foreign currency first, domestic currency later", defining the reform objective as "establishing the financial institution's deposit and loan interest rate mechanism which is decided by the market demand and supply, central bank regulating and leading market interest rate through the monetary instruments with market mechanism playing prevailing role in allocating financial resources. Up to now, China's IRM reform is apparently accelerating.The impact of the relaxing capital price on the operation of China's commercial banks is beginning to appear, however the influence can be more and more distinct with the picking up of IRM reform.. In the short run, at the beginning of IRM reform, the interest rate can rise quickly and fluctuate frequently; the risks concentrating on the banks gradually and systematic risks will increase; debtor's risk structure changes; inter-bank competition in taking in deposits becomes more fierce, etc.In the long run, IRM can make the inter-bank competition more direct, reducing the gap between bank's deposits and loans interest rate on the whole, the way banks making profits can also change; interest rate risks become the major risks facing banks. In face of the challenges from the IRM, China's commercial banks which have existed and developed in the planned economy for such a long time have many shortcomings and difficulties, such as the weak consciousness of keeping away interest rate risks and incomplete internal organizing structure and pinch of professionals, the unbalance of asset-debt structure. It must be improved and adjusted. Such main measures as can be taken: strengthening the sensitivity of interest rate risks, establishing the basic program of interest rate risks management, using the out of sheet management technology to deal with the interest rate risks, quickening the establishment and completing of financial products pricing systems, introducing the working cost technology, developing greatly the medium and out of sheet operation, accelerating the financial innovation and developing towards large scale, globalization and collectivization. At the same time, the administration can take effective and corresponding measures to help actively commercial banks advance their capability of resisting market risks.