The Analysis Of Factors On Intermediary Business Development Among China Commercial Banks

The development of China’s economy is so rapid. The rapid progress of the financial market reform attracts people’s attention. Especially, the interest rate reform and financial disintermediation not only accelerate the process of financial reform, but also challenge the profitability of commercial banks. Traditional profit model of commercial banks relied mainly on net interest income. The interest rate reform narrows the difference between deposit and lending rate and reduces the net interest income. The financial disintermediation makes money bypass the banking system and directly reduces the deposits source. So, traditional profit model of China’s commercial banks has been difficult to sustain and we must find a new breakthrough. As an important part of the income of the bank, intermediary business revenue has a great contribution to the banks’ total revenue. It plays a significant role in driving banks’ profit. Therefore, it is necessary to develop intermediary business. This article identifies the factors that influence the development of intermediary business and analyzes their impact hoping to better promote the development of intermediary business.In order to analysis the influence on the development of intermediate business of commercial banks and find recommendations from the empirical results, this paper is divided into four parts to argue.The first part is the introduction. The introduction introduces why we study the intermediary business and gives the explanation of the significance of intermediary business development in China’s commercial banks. In the same time, it reviews the previous studies and proposes the direction of this study.The second part is the current development of intermediate business of commercial banks in china. This part gives a definition of intermediate business development’s necessity, current situation of intermediate business development and the existing problems.The third part is the empirical analysis about the influencing factors of the development of intermediate business of commercial banks in China. The empirical analysis in this paper is mainly from two aspects, one is about the empirical analysis of the influencing factors on the development of intermediate business on the entire banking industry, and the other is about the influence of the intermediate business development of commercial banks of different credit level.The fourth part is about some policy recommendations. Based on the empirical results, we draw some proposals to promote the development of China’s commercial banks in intermediary business. From the macro perspective, firstly, we should accelerate the development of China’s economy; secondly, we should relax the banking-related financial controls; thirdly, we should improve relevant laws and regulations. From the micro perspective, firstly, we should accelerate the transformation of banking philosophy, and recognize the importance of intermediary business development; secondly, we should increase capital investment and promote the innovation of products business; thirdly, we should development the intermediate business combined with traditional business.Compared with similar articles, this article has the following characteristics:Firstly, it is mainly reflected on the choice of factors. This paper chooses the macro and micro factors that influence the development of intermediary business from the perspective of innovationSecondly, it is also reflected on the comparative analysis about intermediary business development in banks of different credit level.But this paper also has its shortcoming. Due to the limitations of data sources, this article uses fee and commission income as the intermediate business income data. However, the intermediate business has a wide classification range, if we can subdivide the intermediate business and give the empirical analysis, our conclusions will be more meaningful.