Study On The Factors Affecting Commercial Bank Spreads Under Interest Rate Liberalization

Spread is a major source of commercial bank's profits under traditional interest rate controlling, is also an important standard to measure the efficiency of commercial banks. In recent years, China's interest rate liberalization reform deepening, spreads regulation gradually relaxed, bank's deposit and lending pricing interval gradually expanding, these changes will cut down the protection of net interest margin, commercial banks will face greater competitive pressure. Especially on October 24, 2015, the central bank open the floating ceiling of the deposit interest rates when cutting the deposit and lending rates and the deposit reserve ratio, which means that the interest rate liberalization reform has basically completed, the money can completely pricing independently, the traditional model of banks to gain profits mainly by spreads faces a huge challenge. How banking industry face various challenges under the background of interest rate liberalization, and form an effective independent pricing ability, and how the main factors influencing the bank spreads changes in all became the current important issue.Based on this perspective, we educe the main factors influencing the commercial banks' interest rate according to Maudos-Guevara's model, and select control variables according to commercial banks' operation situation and the development of online lending, do a overall regression according to the panel data of 35 banks from2007 to 2014 firstly, then divide all commercial banks to state-owned banks,joint-stock banks and city commercial banks to do regression analysis respectively.According to the thread of this paper, first of all sum up the domestic and foreign existing papers, review the influence factor of net interest margin, analysis for theoretical basis and possible innovation points, provide theory and technology support for the follow-up studies; Secondly, the paper expounds net interest margin calculation method and the relevant theoretical basis as well as theoretical model about the influencing factors of spread in the existing researches. Then summarize and sum up the process of market-oriented interest rate reform in our country, analyze the change of commercial bank's net interest margin trend; In succession, build the econometric model combining with the economic realities of China on the basis ofthe existing theoretical model, and makes an empirical analysis using the existing data; Finally, come to a conclusion and provide some countermeasures and suggestions.The results shows that the main factors influencing the commercial bank's net interest margin are: market concentration, operating costs, the degree of risk aversion,interest rate risk, credit risk, transaction size and online lending. The influence factors of different types of commercial banks is different, the main factors that influence the state-owned bank's net interest margin are market concentration, and operation cost;Net interest margin determinant of joint-stock banks is mainly operating costs and credit risk; And the main factors influencing the city commercial banks' net interest margin are the degree of risk aversion, credit risk and online lending. However,transaction size shows different influence to three types of bank,and the influence of intermediate business ratio was not significant. Based on the above research conclusion, get several enlightenments: under the background of interest rate liberalization, commercial banks should reduce cost, improve the management efficiency; Establish management mechanism, strengthen risk management;Developing intermediary business, to achieve business innovation; Develop Internet Finance, to carry out the mixed operation; All kinds of Banks should find a targeted management system according to their own characteristics, state-owned banks and joint-stock banks should strive to reduce costs and improve loan quality, and city commercial banks should continue to expand market share and improve their competitiveness, then try to develop internet finance, achieve business innovation.