Research On The Effects Of The Development Of Multi-level Capital Market On City Commercial Banks

At present,China has established a multi-level capital market system,which is consist of motherboard market,small board market,GEM market,National Equities Exchange and Quotations and regional equity trading market.Different level of capital markets complement each other and play an important role in promoting optimal allocation of resources,helping corporate finance and promoting the upgrading of China's industrial structure.But with the further development of China's capital market,our country's financing structure is also constantly changing.The increase in the proportion of direct financing contributed to the development of financial disintermediation.Commercial banks' way of profit is under attack that relying on deposit and lending spreads.With the decline in profitability,the traditional position of commercial banks is falling.Because of their small size,low innovation capacity,business type and other issues,city commercial banks are more dependent on deposit and loan business.The ratio that deposit and loan profit ratio to the total profit is much higher than other state-owned banks and joint-stock commercial banks.So the rapid development of direct financing further diverted the profits of urban commercial banks.City commercial banks are at a disadvantage in their competition with large banks.The development of the capital market brings not only the impact to the city commercial banks at the same time but also a lot of new development opportunities.City commercial banks should take this opportunity to innovate in business and improve capital adequacy ratio,improve asset structure and provide a new way and means for the risk control by IPO.China's urban commercial banks should seize the opportunity to develop in the context of the development of multi-level capital market,do their best to develop their own business areas and improve the quality and level of service.They should obtain considerable development in the increasingly fierce competition in the industry.First of all,they must adhere to the differentiated development strategy and take a road with its own characteristics of the development.Different levels of urban commercial banks should also clear their respective positioning.Second,they must speed up the pace of business transformation,expand the retail business and strengthen cooperation between the industry to improve the overall competitiveness.They need to pay attention to the cultivation and introduction of talent,improve the corporate governance structure and grasp the market and government trends timely.In this way they can provide convenient conditions for the development of city commercial banks.