Study On Profitability And Its Influencing Factors Of China's Trust Companies

After more than 30 years of development,China's trust industry has become the second largest financial pillar industry.Its development status plays an important role in the financial market and the entire national economy.After the trust company experienced reorganization and standardized operations,its profitability has also been steadily improved.However,in recent years,with the weakening of system dividends,regulatory policies have imposed more restrictions on trust businesses.As the economy has entered a transitional period,the real economy has become cold.Investing and financing needs and opportunities have decreased,credit and market risks have increased,and the profitability of trust companies has been continuously reduced.In addition,other industries such as bank securities have also launched trust-like products,which have diverted the original market of trust companies.In the situation of internal and external troubles,the competition in the trust industry has become more intense.How to improve and enhance the profitability of trust companies has become the focus of discussion and attention in the industry.Based on the above background,this paper selects the profitability and influencing factors of China's trust companies as the research object.First,the concept,measurement method and influencing factors of the profitability of the trust company are qualitatively described and analyzed.Then,the current status of profitability of the entire industry in which the trust company is located is dynamically analyzed from the overall status and structural status,and the problems existing in the overall profitability of the industry are summarized.Next,an index system for evaluating the profitability of trust companies was established.Factor analysis method were used to comprehensively evaluate and rank 63 trust companies' profitability in the past five years,and empirical results were analyzed from different perspectives.After that,a fixed effect model was used to conduct panel regression analysis on the relationship between the profitability of trust companies and macro,meso,and micro influencing factors,and the influence and direction of each factor were obtained.Finally,summing up research results and propose suggestions for the improvement of profitability of the three main bodies of government departments,industry associations and trust companies.Through the study of the combination of qualitative and quantitative research on the profitability of trust companies and the influencing factors,this paper draws the following conclusions: The overall profitability of the trust industry has risen.There is a wide range of businesses but the main business is not outstanding,and the public trust consciousness.There are large differences in profitability between trust companies,internal differentiation increases,companies with higher overall profitability are stronger,rankings are less affected by external factors,and companies with lower rankings have a single business.The shareholder background of the central SOE state-owned SOEs has a higher comprehensive ranking of the profitability of the trust companies,and the trust companies in the eastern region have a stronger comprehensive profitability.The scale factor has the greatest impact on the profitability of the trust companies.There is a phenomenon that the profitability is declining due to the uneconomical scale caused by blind expansion.The profitability of the trust company can be enhanced by improving innovation,risk control,and the proportion of highly educated personnel.