An Analysis Of The Impact Of Non - Interest Income On The Performance Of Commercial Banks

In November 2014, the Central Bank announced the rate cut again after two years, which is a undoubtedly bad signal to the China’s commercial banks that traditionally relied on interest income. At the current market where interest rate is market-oriented finance is disintermediation, business is integrating, Chinese commercial banks facing a series of competition, are turning away from traditional deposit and lending business of non-interest business, opening up new revenue growth opportunities. In fact, ever since the subprime crisis, Chinese banks ’ non-interest business has started rapid development, banks on intermediate business innovations. For nearly two years the rise of Internet banking has put pressure on major banks, they have started to change their concepts. With a variety of financial institutions to cooperate actively advancing comprehensive operation, China’s commercial banking sector entered a new stage of development. However, for non-interest business, there is much controversy in the academic world, for growth in non-interest income was enough to significantly improve the banks ’ business performance, what kind of Bank’s development more dependent on non-interest income, still needs further research.Based on the financial data for samples of the 16 listed banks in China, constructed by panel data model of quantitative study on commercial bank’s non-interest income effects on its business performance and major commercial banks in China are divided into large State-owned and joint-stock firms, city commercial banks and other three respectively. Results showed that the commercial banks ’ non-interest income ratio’s influence on the profitability of commercial banks is not a significant positive relationship.