The Effect Of Non-interest Income On Risk Of List Commercial Banks In China

With the further advance the process of marketization of interest rates, commercial banks rely on traditional deposit and lending spreads as the main way of profit business model under severe challenge. The influx of foreign banks further intensified competition in the banking sector, crowding out the development of China’s commercial banks. The rise of the Internet has changed the format of financial financial sector, and to carry out caused some impact on traditional business of commercial banks. Foreign banks, competition mechanism Forced Internet financial business transformation of China’s commercial banks. Secondary Transition To meet various challenges, improve their overall competitiveness, China’s commercial banks gradual business development, namely: to carry out non-interest income business on the basis of the development of traditional business on the interest income.With the development of non-interest income business, its impact on the business risks of commercial banks more and more attention. Due to differences in the level of risk components of non-interest business and risk management of banks of different commercial banks, non-interest income risk impact on China’s commercial banks and no clear conclusion. Based on our 14 listed commercial banks non-interest influence on data analysis of China’s commercial banks operating risk by constructing a panel data model, in order to provide useful suggestions for the development of China’s commercial banks non-interest income.This paper reviews the concept of non-interest income and the risk of commercial banks, non-interest income business conduct describes the theoretical basis and noninterest income of the bank’s business risk conduction mechanism, do theoretical preparation for later quantitative analysis; then analyzes the China’s commercial banks non-interest current development of business, and noted its urgency; on this basis, select the 14 commercial banks empirical data analysis. In the empirical analysis part, we choose Z-Score as a measure of bank risk indicators, based on the size of commercial bank assets and equity situation of the bank structure sample into state-controlled banks and two types of non-state-controlled banks, non-interest income business were investigated for two class of banks to risks, and ultimately concluded. In this paper, through empirical analysis we found that:(1) Non-interest income can reduce business risk of Chinese commercial banks, but this effect is due to the superimposed effect of non-interest income volatility and weakened.(2) Fee and commission income business can reduce business risk of commercial banks. Non-interest income and to carry out investment business can reduce business risk state-controlled banks, but instead increases the business risk of non-state-controlled banks. This paper concludes with recommendations for appropriate policies and empirical results for China’s commercial banks to expand non-interest income.