Analysis On The Influencing Factors Of Profitability Of Urban Commercial Banks In Shandong Province

With the deepening of market-based interest and the rapid development of Internet finance, Chinese banking market is becoming increasingly competitive. Commercial banks want to occupy a more favorable position in the intense competition, they must improve their profitability constantly. Exploring the influence factors of urban commercial banks profitability plays an important role in the development of urban commercial banks.After descriptive analyzing the profitability of urban commercial bank in Shandong province, this paper based on the nine urban commercial banks 2008-2013 panel data,analyzing the factors that affect the profitability of urban commercial banks from uncontrollable external uncontrollable factors and bank characteristic variables. In terms of external factors, by establishing fixed effects regression model analysis, the profitability of urban commercial banks are positive correlated with GDP and HHI. In terms of the bank characteristics factors, based on factor analysis, the banks with strong profitability have high level of assets, non-interest income and interest income,at the same time they can control the cost to income ratio and loan-to-deposit ratio reasonably; based on multivariate regression analysis found that the profitability of urban commercial banks is negatively correlated with bad assets ratio and liquidity ratio, and positively related with the net interest margin, capital adequacy ratio and human capital.According to the empirical analysis results, urban commercial banks should do as follows: expand the scale of assets and market share; maintain a stable interest income,at the same time, increase non-interest income; control the proportion of non-performing assets, reduce the management risk; improve the capital adequacy ratio, increase the ability to resist risks; introduce talents actively to expand human capital.