The Impact Of Income Structure Of Commercial Banks On Profitability

Recent years,since the new normal of Chinese economy and the basic completion of interest rate marketization,the financial disintermediation is highlighting.Banking industry is facing downward pressure on the net interest margin.Thus,the discussion about the development of revenue structure must be enforced.At present,there are two diametrically opposed views about the impact of the income structure on the bank's performance.In addition,it still lacks of discussion based on Empirical research at home and abroad.So,we take Japanese banks into consideration and discussion in order to know more about our defects in the development of income structure and learn from the lessons and summarize such experience.This paper firstly combed the concept of operating income especially the non-interest income,and then summarized the economic effects of non-interest business conduct.Next then,this paper reviewed the research about the impact of the income structure on the bank's performance at home and abroad.Although the length of study varies domestic and overseas based on the difference of development,there both exists different voices on this issue.One view is that a diversified revenue structure is conducive to the improvement of the performance of commercial banks;while the other is that diversified revenue structure of commercial banks in improving business performance is unhelpful.Combined with the actual development of China commercial banks and our research objects,the paper selected financial data of 14 Chinese listed commercial banks and 16 Japanese commercial banks for nine years to study.In the next part,the paper systematically analyzes the income structure difference of Chinese and Japanese commercial banks,including briefing information,mainly the development of non-interest business,differences and causes.In the empirical analysis part,we select the financial data of 14 Chinese listed commercial banks and 16 Japanese commercial banks during the period of 2007 to 2015 as the research sample,and classified into 6 subsamples in accordance with the size of bank assets.This paper selects the total return on assets(ROA)reflect banks' profitability,the net interest margin(NIM),the proportion of non-interest income(NIIR)and fee and commission income(FCI),net invest income ratio(NII),other non-interest income ratio(OTHER),reflect the bank's income structure and the cost income ratio(COST),bank size(ASSET),the rate of non-performing loans(NPL)and macro-economic growth rate(GDP)as a control variable.Then we take regression analysis by using EVIEWS panel data model.The track of regression analysis are as follows: Firstly,we make descriptive statistical analysis for all major variables,in order to understand the changes of the variables themselves,and then use Hausman test method determines choose a fixed effect model or random effects regression model,finally we make the panel data regression testing.At last,based on the theoretical analysis and the empirical analysis,the paper put forward some suggestions to develop the non-interest income.