International Journal of Economics, Finance and Management Sciences

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Empirical Study on the Impact of Commercial Bank Income Structure on Profitability

Received: 12 November 2015    Accepted:     Published: 12 November 2015
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Abstract

With the development of banking business and the deepening of market competition, the rate of interest income in the bank's overall revenue became smaller and smaller. More banks began to divert attention to the pioneering types of services, and increasing non-interest income. According to the general theory of academia, the currently 14 listed China’s commercial banks can be divided into large joint-stock banks, medium-sized joint-stock banks and city commercial banks. Based on annual data from 2008-2014 of each listed commercial banks, we did quantitative analysis of the impact of income structure on commercial bank profitability. Analysis showed that the proportion of non-interest income (fees and commission income accounted for in the total income of) in all income and net interest margin made a positive impact on the bank profitability. In addition, macroeconomic performance also had a positive impact on bank profitability. For the national joint-stock banks and city commercial banks, loans had a negative impact on profitability.

DOI 10.11648/j.ijefm.20150305.32
Published in International Journal of Economics, Finance and Management Sciences (Volume 3, Issue 5, October 2015)
Page(s) 599-603
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

China’s Commercial Bank, Income Structure, Profitability, Empirical Study

References
[1] Dai Xianglong. Commercial Bank Management[M]. Beijing: China's Financial Press, 1998: 69-95.
[2] Wang Zhijun. The European Banking Sector Non-interest Income. International Financial Research [J], 2004, (7): 47-52.
[3] Wang Juan. Non-interest Income and Its Impact on the Performance of Listed Banks of China’s Study [D]. Southwestern University of Finance and Economics, 2013.
[4] Wang Manshu, Liu xiaofang. Commercial Banks to the Impact on the Profitability of Banks' Income Structure Research Based on the Analysis of the Data of 14 Listed Banks in China [J]. Nankai Management Review, 2013, 02: 143-149.
[5] Alatengsudao. The Influence Factors of China's Commercial Bank Profitability [D]. Chongqing University, 2013.
[6] Wang Xiaolong. China’s Commercial Bank Income Structure Research [D]. Northeast University of Finance and Economics, 2012.
[7] Zhao Xin, Pan Yanyan, Zheng Hui. A Study of Profit Growth Capacity Effect of Commercial Banks' Income Structure Based on Non-Stationary Panel Model [J]. Journal of Ocean University of China, 2014, (5).
[8] Wan Jiaju. Income Structure Transformation of Commercial Banks in the Interest Market [J]. China Business Update, 2014, (13).
[9] Lu Jing,Alatengsudao,Yin Yuming. The Impact of Banks' Activity and Funding Strategies on Risk and Returns [J]. China Soft Science, 2013, (9).
[10] Wang Wei. Empirical Study on Cost Efficiency of China's Commercial Banks [J]. China Business and Market, 2014, 28(1).
Author Information
  • The School of Economics, Shanghai University, Shanghai, China

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    Zengfeng Ji. (2015). Empirical Study on the Impact of Commercial Bank Income Structure on Profitability. International Journal of Economics, Finance and Management Sciences, 3(5), 599-603. https://doi.org/10.11648/j.ijefm.20150305.32

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    Zengfeng Ji. Empirical Study on the Impact of Commercial Bank Income Structure on Profitability. Int. J. Econ. Finance Manag. Sci. 2015, 3(5), 599-603. doi: 10.11648/j.ijefm.20150305.32

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    AMA Style

    Zengfeng Ji. Empirical Study on the Impact of Commercial Bank Income Structure on Profitability. Int J Econ Finance Manag Sci. 2015;3(5):599-603. doi: 10.11648/j.ijefm.20150305.32

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  • @article{10.11648/j.ijefm.20150305.32,
      author = {Zengfeng Ji},
      title = {Empirical Study on the Impact of Commercial Bank Income Structure on Profitability},
      journal = {International Journal of Economics, Finance and Management Sciences},
      volume = {3},
      number = {5},
      pages = {599-603},
      doi = {10.11648/j.ijefm.20150305.32},
      url = {https://doi.org/10.11648/j.ijefm.20150305.32},
      eprint = {https://download.sciencepg.com/pdf/10.11648.j.ijefm.20150305.32},
      abstract = {With the development of banking business and the deepening of market competition, the rate of interest income in the bank's overall revenue became smaller and smaller. More banks began to divert attention to the pioneering types of services, and increasing non-interest income. According to the general theory of academia, the currently 14 listed China’s commercial banks can be divided into large joint-stock banks, medium-sized joint-stock banks and city commercial banks. Based on annual data from 2008-2014 of each listed commercial banks, we did quantitative analysis of the impact of income structure on commercial bank profitability. Analysis showed that the proportion of non-interest income (fees and commission income accounted for in the total income of) in all income and net interest margin made a positive impact on the bank profitability. In addition, macroeconomic performance also had a positive impact on bank profitability. For the national joint-stock banks and city commercial banks, loans had a negative impact on profitability.},
     year = {2015}
    }
    

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  • TY  - JOUR
    T1  - Empirical Study on the Impact of Commercial Bank Income Structure on Profitability
    AU  - Zengfeng Ji
    Y1  - 2015/11/12
    PY  - 2015
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    JF  - International Journal of Economics, Finance and Management Sciences
    JO  - International Journal of Economics, Finance and Management Sciences
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    PB  - Science Publishing Group
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    UR  - https://doi.org/10.11648/j.ijefm.20150305.32
    AB  - With the development of banking business and the deepening of market competition, the rate of interest income in the bank's overall revenue became smaller and smaller. More banks began to divert attention to the pioneering types of services, and increasing non-interest income. According to the general theory of academia, the currently 14 listed China’s commercial banks can be divided into large joint-stock banks, medium-sized joint-stock banks and city commercial banks. Based on annual data from 2008-2014 of each listed commercial banks, we did quantitative analysis of the impact of income structure on commercial bank profitability. Analysis showed that the proportion of non-interest income (fees and commission income accounted for in the total income of) in all income and net interest margin made a positive impact on the bank profitability. In addition, macroeconomic performance also had a positive impact on bank profitability. For the national joint-stock banks and city commercial banks, loans had a negative impact on profitability.
    VL  - 3
    IS  - 5
    ER  - 

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