Study Of Financial Products Of Commercial Banks In China

As part of the off-balance sheet activities, the emission of commercial banking financial products can not only effectively avoid the supervise, but also be propitious to increase the banking profit and performance. As one of the financial derivative instruments, financial products play an important role of financial instruments in financial market. Because of the high discretion and raising funds in short time, financial products can also tap the liquidity of investment objective adequately. Commercial banking financial products overseas become full-fledged. It has been eight years since the formation of domestic commercial banking financial products’market in2004. In the eight years, the market of domestic commercial banking financial products grows vigorously and precipitates a lot of significant characters. There are three investigations in this article:(1)This article analyzes the development trend of domestic commercial banking financial products’market by history, using data lists and tendency charts. It concludes the financial products’market develops underway from2004to2007, and rapidly develops from2008to2011, then into monopolistic competition. Large-scale banks take up most of the market share, and the small and medium-sized banks just have the scalar advantage in emission bank. The financial products mostly invest in bond and interest rate. Most financial products invest in CNY. But with the diverse development of trade, it will enrich in currency.(2)By studying commission time, break even proportion and expected yield lower limit, the article concludes the character that domestic commercial banking financial products have short commission time. Large-sized commercial banks mostly emit no-break even products. This indicates that large-sized banks transfer the risk to the clients, and medium-sized banks respond more responsibilities in the break-even proportion in order to attract the clients to buy financial products. Commercial banks tend to be optimistic in expected yield lower limit. On the other side, there exists seasonal effect in the emission of financial products. The amount of financial products is less than the month before in June and October, because of performance appraisal and tourism season.(3)Using linear regression, the article concludes effective yield has direct proportion with expected yield lower limit, publisher, investment portfolio, commission time and inflation rate. This indicates that expected yield lower limit can reflects the effective yield. The larger the issued banks are, the higher the effective yield is. The longer the commission time is, the higher the effective yield is. Although the effective yield has direct proportion with inflation rate, the effective yield is not always higher than the effective yield. The effective yield has inversely proportional with break even proportion.The commercial bank shifts risks to the clients using no-break even products. Large-sized banks play leading roles in the market of financial products because of particular advantage. Middle-sized and small banks have to promise more and take more risk in order to attract the clients purchasing financial products. This paper tables some proposals from the point of regulator, banking and client, in order to stimulate the development of commercial banking financial products’ market.