Research On The Commercial Bank Competition、Income Diversification And Stability

As our country enters “new normal”,there are new characteristics in bank market.The reform of commercial banks continue to deepen,private capital access to bank market constantly,internet finance develops rapidly,in new economic and financial situation,because bank is the core of finance,there are much theoretical and practical significance in the research of bank stability.Based on a panel data of 46 commercial banks in China for the period 2006-2015,this paper investigate the relation among bank market competition、income diversification and bank stability,and this paper found that:(1)the market power of commercial bank and bank stability are positively related,and the degree of bank market competition is not conducive to bank stability,supporting “competition-fragility”;(2)there is an “inverted U shape” relationship between commercial bank market concentration and bank stability,and bank market is at the left of “inverted U shape” currently,the increase of market concentration is beneficial for bank stability.(3)there is an “inverted U shape” relationship between income diversification and bank stability,income diversification of different banks has different effect.(4)bank market power and income diversification are positive related,and the increase of bank market competition and concentration are both conducive to income diversification.