The Impact Of Economic Cycle On China’s Commercial Bank Profit:An Empirical Evaluation

This paper analysis based on interest oriented profit model and non interest oriented profit model of commercial bank, and analysis the path of economic cycle effect on commercial bank profitability in theory, and established the theoretical model of economic cycle effect on commercial bank profitability. After studying conduction intermediary effect mechanism of economic cycle from the macro and micro level, this paper selected from2001to2012of14listed commercial banks’ return on assets, loan growth rate, non-performing loan ratio and net interest margins, as related variables, and selected from2001to2012GDP growth rate as reflecting the data index of the economic cycle, to making an empirical analysis of the impact of commercial bank profitability, and quantitatively investigating the influence the degree and direction of each intermediate variable and the economic cycle on commercial banks. Through the establishment of the fixed effect model, the empirical results show that:economic cycle has a positive effect on our country commercial bank profitability, and our country commercial bank profit exist cyclical; at the same time, the credit and net interest margin also exists along the cycle characteristics, and have a positive effect on profitability of commercial banks, which proves that the profit pattern of commercial banks in China is still mainly traditional interest oriented; while non-performing loan ratio is counter cyclical, and produce negative effect on bank profitability.