Research On Profitability Of Bank Of China Limitde

As an important part of the national financial system and the national economy,commercial banks have always been regarded as the vane of national economic development.In recent years,with the continuous exertion of the state on the financial market,the competition of commercial banks has become more and more fierce.How to survive in the fierce market competition and improve profitability is an important issue facing commercial banks.Bank of China Limited(hereinafter referred to as Bank of China)was established before the founding of the People's Republic of China.It had mainly assumed the foreign exchange management function of China and had a certain influence overseas.In the increasingly fierce competition in the domestic market,its profitability has also been slow in recent years.The downward trend is representative of the profitability of financial markets in the context of reforms.How to achieve survival and development in the context of increasingly open domestic financial markets and stricter financial regulation is a major problem facing the Chinese banking industry.This paper studies the profitability of Bank of China,analyzes the quality of Bank of China's profitability and factors that restrict profitability,and provides reference and reference for the improvement of profitability of other commercial banks.This paper uses the analysis method combining theory and empirical research to first define the profitability and the profitability of commercial banks.Based on the overview of the Bank of China,it is based on the advantages of profitability,sustainability and growth.The vertical and horizontal comparative analysis of bank profitability shows that its profitability shows a decline in the return on net assets and net interest income in terms of profitability;in terms of sustainability,non-performing loans are rising year by year;in terms of growth,The net interest rate on business declined.Secondly,in order to further identify the core factors affecting the profitability of Chinese banks and to determine the extent to which these factors affect profitability,this paper selects asset size,liquidity indicators,asset adequacy,cost management benefits,and deposit and loan business in the empirical part.Factors such as capacity and intermediate business capabilities,using the relevant indicators data of Bank of China from 2005 to 2016,the empirical test of multiple regression models.The empirical results show that capital adequacy,cost management efficiency and intermediate business capability have positive effects on asset return rate;bank asset size and liquidity index are negatively correlated with asset yield.This shows that the Bank of China has not achieved the benefits brought by economies of scale.Instead,it has affected the bank's profitability due to scale expansion and cost.The conclusion also shows that the significant impact of the net interest income on the return on assets is not obvious.In the current financial market environment,the traditional profit model based on interest rate differential has been affected to some extent.Finally,based on the above analysis results,combined withthe characteristics of the development of the Bank of China,it is proposed to actively adjust the income structure under the premise of strengthening the cost budget and risk management,and to innovate the “lending and depositing” model and the development of special intermediary services such as overseas agents.Sexual strategy to improve the profitability of the Bank of China.