Analysis Of Chinese Private Banking Business Development

China’s sustained and stable development has brought a significant increase in Chinese wealth. Especially, because of globalization, expansion of capital market and implementation of the GEM stock market, China’s new class of wealthy expanded. Great potential customers become a superb foundation for private bank industry. Today, this industry has gradually become a key point for the restructuring and innovation of commercial banks. Although commercial banks survived in the global financial crisis, interest rates liberalization reform and financial disintermediation have put a great threat in front of them. Fonner business model which depended on high credit spread has been unable to continue in a long-term dimension. Financial globalization and integration have been the most influential in bank business. And private bank will be the most powerful weapon for China’s commercial banks.Local advantages in customer resources provide great opportunity for China’s commercial banks. Due to inferior institution structure and reserve of talents constraints, they’re in weaker position in the competition with multinational banks. Learning from famous international banks, following social trends and making good use of the growth of Chinese wealth, a private banking system with Chinese characteristics will be promoted and developed very well.Private bank faces both great development potential and challenges. First of all, there’re great resources of clients and funds. China’s growing wealthy class has become an invaluable source of funds providers. They have more trust in domestic banks due to long-term business relationship. Secondly, they have innate local advantages. Domestic commercial banks have an extensive network of branches all around China. It’s easier for them to get close to local resident and expand markets. Thirdly, China’s rapid economic growth and the mixed financial management make it a historic opportunity for China’s private banking business. More innovative financial services and financial products will appear. The intersection and integration among various financial institutions will be irreversible. Tax reform creates a fair environment for competition. According to Law of Enterprise Income Tax, both domestic and foreign enterprises need to pay a rate of25%in enterprise income tax. This regulation has changed the disadvantaged position of domestic banks in the competition with foreign banks.This article focuses on the research of development of China’s private banks based on China’s largest commercial bank-Industrial and Commercial Bank of China. It included five chapters. In Chapter Ⅰ, we explained why we chose this topic, and gave a brief literature about private banking. In Chapter Ⅱ, we introduced the concept and elements of private banking, and we also analyzed the differences between private banking business and other financial services. In Chapter Ⅲ, we traced back to the history of the development of private banking business from the international and the domestic aspects. Also, there was an analysis in the foundation of the application of private banking, various products, service system, team building and brand impact of many domestic commercial banks. In Chapter Ⅳ, we analyzed the private banking business of ICBC. At first, we gave a brief overview about ICBC and its business. Secondly, we investigated its eight main ranges of private banking services:asset management, alternative investment business, discretionary services, consulting services, financial management services, cross-border financial services, wealth inheritance services, value-added services. In Chapter Ⅴ, we provided many difficulties for the development of private banking and gave some advices on the future direction. We made a summary about our paper in this part.To strengthen private banking business of ICBC, there’s a strong need for scientific development of standards, changes in organizational structure, strengthening team building, improvements in financial planning and scientific and technological innovation. Only in this way, these efforts will lay a good foundation for the competitiveness of ICBC.