| The theory of financial repression and deepening puts forward a wave of financial liberalization.China has also implemented the reform of interest rate liberalization since 1993.Until now,financial institutions’ lending rate fully liberalized in 2013,while the deposit interest rate liberalization reform was completed in October 2015.The reform of interest rates liberalization has brought lots of changes for the operation of commercial banks,and the narrowing of the net interest margin forced them to adjust their business structure and profit structure.Therefore,in order to explore the impact of interest rate liberalization on China’s banking industry.This paper chose the banking market structure as the starting point;select the competitiveness of the banking industry as the research object.First,this paper reviews the theory of banking market structure and the course of China’s interest rate liberalization reform,so that it can provide the theoretical basis and factual basis for the full text.Then we estimates the market competition structure of China’s banking industry by using Panzar-Rosse model based on the panel data of 50 commercial banks;Finally,through the construction of the interest rate liberalization index,we make an empirical analysis which measures the impact of interest rate liberalization to China’s banking industry.The results show that: China’s banking industry belongs to the pattern of monopolistic competition market.And the interest rate liberalization increases the degree of competition.Besides,the development of non-bank financial sector,especially securities industry,has positive promotion.According to the results of the study,we put some policy proposal: first,commercial banks should speed up financial innovation and improve intermediary business revenue;second,regulators ought to strengthen financial supervision and prevent potential risks;third,our government must improve the multi-level capital market. |
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