Analysis On The Optimization And Transformation Of Y Rural Commercial Bank’s Profit Model

For the past few years,affected by the friction of international trade and the impact of COVID-19 and other factors,China’s economic growth has slowed down significantly.Against these backdrop,the state puts forward the requirement that the economic development should change from high-speed development to high-quality development.As the core part of the financial institution system,commercial banks are related to economic lifeline,their sustainable profitability is crucial to the sustainable and healthy development of the national economy.As the main force in the banking industry to provide effective finacial support for the "Agriculture,Countryside and Farmers" and implement the policy of supporting agriculture,small and micro enterprises,Rural Commercial Banks have the important mission of serving the rural real economy.However,because of the marketization interest rate has basically taken shape,financial disintermediation has formed by the development of capital market,and internet finance has spawned by informatization,competition in the banking market becomes increasingly fierce,the profitability of rural commercial banks is on a gradual downward trend and their traditional spread-driven profitability model is being challenged.Therefore,finding an optimal transformation path for the profitability of Rural Commercial Banks will become the key to insuring the sustainable profitability and diversifying systemic risks.Y Rural Commercial Bank is taken as a case study in this thesis which focuses on its transformation of the profit model.Firstly,the thesis introduces the background and significance of this research,while generalizing about the correlative theories and literatures at home and abroad related to profit model.Then by using the PEST model,financial analysis,and comparative analysis as well as combining the bank’s annual report,the thesis makes a qualitative and quantitative analysis of the current business and profit model of Y Rural Commercial Bank.It still has a traditional spread-driven profit model with net interest income as its main source of revenue.Its extensive profit model that relies on scale expansion to obtain profits,still has problems such as single income structure,insufficient product innovation capability,low contribution of intermediate income and insufficient professional talent pool.It is more and more difficult to adapt to the complex and competitive marketing environment.Finally,given the shortcomings of the profit model of Y Rural Commercial Bank,the author made suggestions to optimize and transform the existing profit model in terms of accurate market positioning,optimizing the structure of liability and asset,innovation of intermediate business,construction of talent pool and empowerment of financial technology,which aim to provide reference for the transformation of the profit model of other rural commercial banks.