Study On The Relationship Between The Ownership Structure And Profitability Of Rural Bank

The problem of agriculture, rural and farmers has always been the focus of thecountry，In recent years, with the pace of the new rural construction and ruralurbanization accelerating, the supply of rural financial resources is more and moreinsufficient, hindered the pace of China’s modernization construction seriously, inorder to solve this problem, the country have launched a series of policy. In2007,under the government’s strong supporting and promoting, Chinese set up a new kindof financial institutions-Rural Banks, and has achieved remarkable success in sizeand number. It has become an important part of new rural financial institutions.Rural banks belongs to company financial institution, it has enterprise legalperson with independent qualification. Ownership structure is the core part of theRural Banks system, it has an important effect on its profitability. At present, RuralBanks implements the main originator system in China, highly concentratedownership structure,it caused the single source of funding. Most of the Rural Banksattached to the main originator, loss of independence, deviate from the marketpositioning, lack of the capability of independent innovation. These are the presentproblems of Rural banks.Based on briefly expatiates the concept of Rural banks, focuses on the study ofthis paper--focus on profitability and ownership structure of Rural banks and givesthem a detailed interpretation, it also give a discussion about relationship betweenownership structure and profitability. Then, based on the current China’s Rural banks’profitability and ownership structure analysis of the status quo, the problem is existingin the profitability and ownership structure of Rural banks, present situation of thatownership structure influence on profitability. In order to make elaborate more clearand convincing, this paper selects16village banks of Shanxi province as the researchsample, using multiple linear regression model, give an empirical study of therelationship between ownership structure and profitability. From the ownershipstructure and profitability of domestic and foreign financial institutions experience,finally, according to the conclusion, on how to improve equity structure, improve profitability about China’s rural banks,this paper puts forward to practical measures,make efforts to build a moderate concentration of ownership structure, at the sametime to ensure that the ownership structure in a variety of forms; But our countriesalso create a suitable environment for the development of village Banks.