The Influence Of The Structure Of Loans On The Bank Performance

Loan is the major form of bank asset in our country and is very important. The latest Financial Crisis which led by the Sub-prime mortage loan crisis makes people reconcern about the stability and health of the banks which involved in investment baking businesses. We can predict that loan will still be the major form of bank asset for a while. So it is possible to help banks to improve their performance by researching the relationship between the loan-structure and the performance of the banks. At past, many researches have been done to observe and describe the structure of loans, but few of those papers involved the research of the relationship between the structure of loans and the performance of the banks. This paper tries to find something in this area by researching from two aspects: the theoretical study and the empirical study.Performance has been researched by many people, but its concept is varying in different researches. Luckily, there still is some common ground: most people agree that loan has a significant externality. So a good concept of Performance must include society performance and so on. This paper will combine ten small performance indexes such as ROE and makes a combined index F to try to express the performance well.The structure of loans means the distribution of loans over areas, industries and something like these. This paper intends to research the relationship between the structure of loans and bank performance, and the structure of loans includes the structure of secured loans, the structure of term, the structure of areas, the structure of industries and the structure of company scale. And then, we have these conclusions:(1) Both of credit and secured loans may have positive influence on bank performance;(2) The influence of the structure of term is not very clear;(3) Banks may perform better when they lend money to richer areas;(4) Monopolistic companies'positive influence is not as big as people think;(5) To lend to small companies is a good choice for banks who want to improve their performance.