The Impact Of Financial Disintermediation On Business Performance Of China's Commercial Banks

With the increasing development and perfection of the capital market,the impact of financial disintermediation on commercial banks is increasing,more and more enterprises through the capital market to direct financing,and the rapid development of non-bank financial institutions,financial products are various,so the commercial banks face the enhanced competitiveness,which leads to the traditional business model of commercial banks face the challenge.However,financial disintermediation has also brought opportunities for the development of commercial banks,in the impact of financial disintermediation,commercial banks can use their own customers,assets,network advantages etc,vigorously develop intermediary business,increase the innovation of financial products,so as to adjust the business structure,reduce the dependence on traditional deposit and loan business,diversify the business.Meanwhile,commercial banks should actively turn to mixed operation,learn from foreign banks' development experience and technology,provide full and personalized financial services,and build universal banks.This paper is composed of five parts: the first part introduces the background and significance of this topic,and then sort out the relevant literature of financial disintermediation,so as to clearly understand the definition,causes and measurement of financial disintermediation and the impact of financial disintermediation on commercial banks,expounds the research methods and significance of this paper,finally,the possible innovation points and shortcomings of this paper are pointed out.The second part defines the category of relevant research,expounds and sorts out the relevant theory of financial disintermediation,analyses the current situation and causes of China's financial disintermediation.The third part analyzes the influence mechanism of financial disintermediation on China's commercial banks,analysis the impact of financial disintermediation from three aspects of commercial bank business structure,income structure,customer structure,through the effect on the three sides of the impact analysis,more accurately understanding the impact of financial disintermediation on commercial banks,so as to realize the challenges and opportunities of financial disintermediation on commercial banks.The fourth part is the empirical analysis,choose the appropriate variables and models,and analyze thepanel data of 16 listed commercial banks in 2007-2016,and get the corresponding results.Measuring the business performance of commercial banks from the perspective of income and risk,using the rate of return on assets and the rate of non-performing loan as the explained variables,then the empirical analysis of the whole sample,the large commercial bank and the small and medium commercial banks,and the results of the regression are analyzed and compared,so as to better understand the impact on different asset sizes.The fifth part is the research conclusions and policy recommendations,by analyzing the above research,we can get the corresponding conclusions,put forward constructive policy and recommendations,for China's commercial banks to better deal with the financial disintermediation.As can be seen from the regression results:for model 4.1,the measure of financial disintermediation has a significant positive correlation with all capital earnings rate of the whole sample,large commercial banks and small and medium-sized commercial banks,with the decline of financial disintermediation index,the degree of financial disintermediation is deepening,resulting in a decline on all capital earnings rate of commercial banks,which has a negative impact on the business performance of commercial banks;for model 4.2,the measure of financial disintermediation has a significant negative correlation with non-performing loan rate of the whole sample,large commercial banks and small and medium-sized commercial banks,show that the decline of financial disintermediation index,the degree of financial disintermediation is deepening,resulting in a rise on non-performing loan rate of commercial banks,which has a negative impact on the business performance of commercial banks.Therefore,through the analysis of the above conclusions,this paper puts forward the corresponding policy suggestions from four aspects: middle business,risk management,management model and customer level.