Research On The Influence Of New Regulations On Asset Management On Rate Of Return Of Financial Products Of Commercial Banks

On the one hand,financial products of commercial banks improve receipts of commercial banks and investors.On the other hand,financial products of commercial banks provide more funds for the rapid development of investment projects.As a result,financial products become popular among commercial banks.However,there are irregularities such as multilayer nesting,rigid payment and avoiding financial supervision and macro-economic control,which contain great financial risks.In order to regulate the asset management business of financial institutions,prevent and control different kinds of financial risks effectively and support economic restructuring and transformation better,new regulations on asset management were officially released on April 27,2018 by the People’s Bank of China,China Banking and Insurance Regulatory Commission,China Securities Regulatory Commission and State Administration of Foreign Exchange.Owing to the fact that new regulations on asset management prohibit rigid payment,asset management business in the balance sheet,maturity mismatch,multilayer nesting and channel business and regulate cash pooling and non-standard assets,they have a great influence on the financial management business of commercial banks.According to new regulations on asset management,all commercial banks must decrease the size of irregular financial products orderly and stop operating irregular financial assets before the end of 2020.At the same time,it still needs time for customers to accept net worth financial products,which will bring great challenges to the income and transformation of financial products of commercial banks over a period of time.Owing to the fact that expected yield is the most intuitive index to indicate changes of financial products of commercial banks timely,this paper uses the rate of return of financial products as the subject in the study.Based on the present situation of financial products of commercial banks,which includes rate of return,issuing scale,guaranteed financial products,net worth financial products and term,this paper intends to find out the influence of new regulations on asset management on rate of return of financial products of commercial banks under theoretical research and empirical analysis based on event study and multivariable linear regression model.The following conclusions are drawn.Firstly,the rate of return of financial products of the whole of commercial banks,joint-equity commercial banks and urban commercial banks falls significantly after new regulations on asset management.Secondly,the rate of return of financial products of state-owned commercial banks does not change significantly after new regulations on asset management.Moreover,this paper explores the main reasons and makes suggestions on improving financial products for all kinds of commercial banks under new regulations on asset management,including improving education and management of investors,regulating operation of financial products,promoting net worth financial products and making innovations in customizing financial products,as well as their own suggestions of state-owned commercial banks,joint-equity commercial banks and urban commercial banks.