A Research On The Effect That The Reform Of Interest Rate Liberalization Have On The Profitability Of The Commercial Banks In China

In recent years, more and more people pay attention to the reform of interest rate liberalization. The reform of interest rate liberalization in China started late and it would not be succeed in a short time as China is a developing country. Some countries like America and Japan had already made efforts to reform the interest rate liberalization before China started its own reform, so China should use the experience in other countries for reference and then combine the experience with the national conditions to plan the route for the reform of interest rate liberalization in China.This essay discussed the background and meaning of the topic-choosing and listed the works of the reform of interest rate liberalization in both China and abroad in the first chapter. It is a steppingstone to the whole essay. The second chapter is about the theoretical basis to the reform of interest rate liberalization. In the third chapter, the essay has mainly discussed the general researches on the effect that the reform of interest rate liberalization have on the profitability of the commercial banks and listed the experiences of the reforms in both China and abroad, the procedures of the reform in our country and the characteristics and developments of the commercial banks in China. It also makes an analysis that based on 17 commercial banks to analyze the profitability of the commercial banks and the effect that the reform of interest rate liberalization have on the commercial banks in China. The fourth chapter is about the empirical analysis. It used the statistics which are based on eight large and medium banks from 2009 to 2014 to establish regress model among four key points, thus to test and verify the exposition above. The fifth chapter is the ending part, which concludes the former chapters and give the advises and choices to different strategies.This essay holds the point that we should establish a good outer environment of risk management under the big circumstance of the reform of interest rate liberalization to stable the inner controlling of interest risks. As to the commercial banks in China, they should change the orientation of their own business. They need to not only maintain their traditional business but also develop the intermediate business to present a nice transition.