The Research On The Impact Of Bank Competition And Non-interest Income On Performance

With the marketization of interest rate,financial globalization and the development of the Internet financial business of commercial Banks in China traditional interest caused serious influence,the commercial Banks face the competition pressure also increased gradually.In the face of these competitive pressures,the development of non-interest business has become a pressure drug to improve the performance of commercial Banks' stable profits.So far in the domestic commercial Banks business income accounted for the total revenue of the central African interest showed a rising trend year by year,but the interest of the business is still a major source of revenue and profitability of commercial Banks,non-interest income also has the very big development space and increase profits.Therefore,it is particularly important to study whether non-interest business can really improve performance in the current fierce market competition environment.Therefore,this paper analyzes the non-interest business and competitive situation of commercial Banks in China,and provides some Suggestions for the development of non-interest business of commercial Banks in China.In this paper,from the first,through the theoretical analysis of bank competition,non-interest income and the relations between and among performance,including the introduction and analysis of the connotation of performance,competition and bank performance in detail,the influence mechanism between definition of non-interest income and bank performance between related theory comb to climb up.After analyzing the literature theory of the foreword,this paper carries on the empirical research.Based on 138 Banks in 2005-2016 annual data of dynamic panel model was set up,our country banking market competition and non-interest income,how to influence bank performance of bank competition proxy variables for Lerner index,and the types of non-interest income and the bank are classified after comparative analysis.The empirical results show that,first,non-interest business has a positive impact on the performance improvement of large Banks,but it is not significant.However,the performance of small and medium-sized Banks has negative influence and significant.The reason is that large Banks because of its advantages dominated the non-interest business fees and commissions in business to make their own profit,and the small and medium-sized Banks to avoid its sharpness,developing other non-interest business,but due to the nature of other non-interest business makes the small and medium-sized Banks is difficult to improve performance by such business.Second,there is a significant negative correlation between market competition and all bank performance.The reason is that at present our country still relies mainly on the interest income commercial Banks as the main part of revenue,and the interest income is affected by the market competition degree increase reduced thus reducing the bank's performance.Finally when the market is monopoly,large Banks able to take advantage of their customers,capital,technology and other advantages in the aspect of non-interest business to obtain more profits,and the small and medium-sized Banks will lose more profit.Based on the above conclusions,some policy Suggestions are provided for the non-interest business of commercial Banks in China.One is to focus on the profitability of non-interest business,the second is to promote the mixed operation mode,and the third is to pay attention to brand building to provide differentiated services.