The Research On Non-interest Income And Performance Of Commercial Banks

As the interest rate liberalization continues to advance, the traditional interest margin is gradually narrowing. Commercial banks are facing the increasingly fierce competition, the traditional profit model is unsustainable. Commercial banks must change the management strategy, adjust the structure of business and take the initiative to adapt to the new economic environment. In such a background, the commercial banks began to attach more importance to develop non-interest income business, it has became a new profit growth point. However, the relationship between non-interest income and bank's performance is not consistent both at home and abroad. The results have great differences in different types of banks affected by different costs, expenses and so on. Therefore, It is remains to be further discussed the relationship between non-interest income and bank's performance in different types of banks.The article start with the concept of non-interest income and expound the related theories of non-interest income. Then analyze the status quo and existing problems of non-interest income between different banks. In the empirical analysis part, 16 banks will be divided into three sample groups including the state-owned banks, the joint-stock banks and the city commercial banks. And select the data from 2007 to 2015 to find how non-interest income affects bank's performance in different types of banks through the empirical analysis.The empirical results show that there is significant positive correlation between the non-interest income ratio and the return on assets of state-owned Banks, and there is no significant positive correlation between the non-interest income and the return on assets of joint stock banks and city commercial banks . This suggests that the development of non-interest income business is beneficial to improve the performance of state-owned commercial banks, but for the joint-stock and city commercial banks' performance has no significant effect. According to the results of the study, some suggestions are given to Chinese commercial banks on how to carry out the non-interest income business in the future.