The Study On Commercial Banking Business Innovation In China

In a modern market economy, finance is becoming more and more prominent. The financial industry as a channel for the distribution of funds, have become an important economic sector. Therefore, financial development is one of the main indicators as an international community to measure the economic development and social progress of civilization. The development of the financial industry is the inner motivation of financial innovation. From the end of the 1960s, the financial industry in the developed Western countries started a revolution in the financial services industry. With the deepening of reform and opening up, especially since 2002, financial innovations among domestic commercial bank in business is going stronger and stronger. Therefore, the study of financial innovation has become an important issue of the current financial research. This paper, which is consistent with this need, investigates the research on innovation trends of commercial banking business in western state, analyses the commercial banking business innovation and the need for the status in China, and draw some conclusions and basic judgment at last.This paper is divided into four parts. The introduction explains the motivations and significance of financial innovations for Chinese commercial banks. It also illustrates the background for making business innovations of commercial banks. The body of this paper exposes the research of the financial business innovations in details. The concrete structure is as followed:Chapter 1 summarizes the financial business innovations in commercial banks theoretically. First, this paper exposes the definition of financial innovation. Second, this paper represents the definition of the financial business innovation in the way of the content of financial business innovation. That is micro-finance organizations in the external environment, to avoid risks and achieve maximum profits, with its various elements of the innovative changes and development activities. On this basis, this paper concludes the theoretical results on commercial banks innovation of domestic and foreign scholars.Chapter 2 illustrates the development trend of commercial bank business innovation in Western and the inspiration to China. First, this paper proposes the development trend of commercial bank business innovation in Western, which is mixed operations, asset securitization, development of Internet banking, derivative financial instruments and so on. Because of the above fact, there are two revelations for China's commercial banks in the financial business innovation: to accelerate the development of financial markets and development and to accelerate the electronic information system construction.Chapter 3, which is the focal point in this paper, analyses the current situation of commercial banking business innovation in China and its necessity. This chapter illustrates the current situation and existing problems of commercial banking business innovation in China. It also analyses the difference of commercial banking business innovation between in China and in the developed western countries. Besides, this chapter illustrates development principles and the direction of commercial banking business innovation. First, this paper analyses the current situation and existing problems of commercial banking business innovation in China, using the data on domestic commercial banking business innovation, mainly as in electronic banking innovation and personal financial business innovation. Meanwhile, this paper points out the misunderstandings in the areas of commercial bank business innovation: the product could not meet the needs of customers'personalization and diversification; the number of compound products is very small and the profitability is poor; there are more introduced innovations and little creative innovations; it is easy to polarize in the new business risk prevention. Second, this chapter analyses the necessity of commercial banking business innovations in China. It has internal and external factors, which influence the inevitable trend of commercial banking business innovation. The internal factor is mainly focused on the financial media, while, the external factor is mainly focused on the fierce competition caused by foreign banks'entering. At last, this chapter analyses the conditioned factors of commercial banking business innovations in China, which are included two internal and external factors. The internal factor is the defect of commercial banks'internal management system. The external factor is because of the imperfect policy environment.Chapter 4 illustrates the strategic thinking of commercial banking business innovations in China. Perfecting the strategic thinking of commercial banking business innovation in China should be in the following aspect: to accelerate the assets and liabilities of business innovation; to focus on developing the personal financial business innovation; to timely develop investment banking business; to implement the logos of customer-centric business; to adapt the organization and management model of business innovation.