The Analysis On The Influencing Factors Of Intermediary Business Of Our Country Commercial Bank

Since 1980s, the intermediate business had developed and grown in foreign countries. And income from intermediate business had become the second important backbone of bank’s revenue. To rely the changes of global economy, domestic financial supervision and demand of bank clients, in recent years, domestic commercial banks have pay more attention on the development of intermediate business. Their focus is on the innovation of financial products and service, the foundation of clients, the stable relationship with clients, etc. And their aim is to promote banks’benefit and the development of traditional business.There are five parts in this paper. The first part is about research background, significance, research method, as well as innovation and weakness. Part two is review of intermediate business. This part include intermediate business"s definition, category and summarization about the overall related literatures. The third part is about the development of intermediate business in Industrial Bank CO. LTD. The author also picked up related data from 2003 to 2012. The tendency shows that the intermediate business income has occupied the total income from lee than 4 percent to more than 17 percent, which shows a rapid increase. At the same time, the author examined the efficiency of Industrial Bank’s intermediate business with use of both profit margin and asset efficiency ratio. The persuasive results show that Industrial Bank has experienced obvious development in intermediate business. Even though, the ratio of intermediate business income occupied total operating income in Industrial Bank is lower than that of the five biggest banks. What is more, there are obvious differences between these two kinds of banks. The differences are closely related with banks’characteristics, such as capital scale, institutional amount, clients amount and so on. In this part, the author uses SWOT analysis to analyze strength, weakness, opportunity and threat of the Industrial Bank. Through the SWOT analysis, we come to the related developing strategy. The fourth part is empirical analysis. Firstly, we select the Industrial Bank from January 2007 to September 2014 quarterly data to study the influence factor of the Industrial Bank of intermediary business revenue through the VAR model and error correction model. The results showed that the Intermediate business income was proportional to the macroeconomic environment. In the micro level, intermediate business income is highly relevant to the structure of bank assets and it is better for the development of intermediary business with a lower debt ratio. In the following, paper selected the quarterly data from 2007 to 2014 of state-owned banks to establish panel regression model. The results show that compared with the state-owned banks, the debt ratio and ROE of the Industrial Bank is more sensitive to its intermediate business income. In the fifth part, the author comes up with six suggestions about the development of domestic intermediate business. They are as follows:first, improve the knowledge about the intermediate business and explicit its strategic position; second, the bank should aim at the efficiency of intermediate business not only the rapid speed of it; third, promote the development of intermediate business step by step; forth, pay more attention on the innovation of related business; fifth, perfect the inside mechanism of intermediate business to avoid bank risks; sixth, control the bank’s financial risk and pay attention to the new products’quality of intermediary business.Nowadays, the banking industry is facing the profound outside and inside changes. These changes bring both his opportunities and challenges. Thus, the banks should grasp the opportunities, strengthen and improve the financial service, and construct differently competitive superiority. Only the ones which can forge ahead will have a brighter future.