Analysis of the Impact of Interest Rate Liberalization on Commercial Banks

Abstract

The reform of China's interest rate marketization has basically been completed, and commercial banks, which are one of the main players in the financial market, will inevitably be affected. This paper starts from the framework of commercial banks' "three principles ", namely, security, liquidity and profitability, and analyzes the challenges and opportunities brought by the interest rate marketization reform to China's commercial banks. Then the paper analyzes the characteristics of the two kinds of interest rate marketization models in the world, namely "gradual" and "radical", and concludes that the "gradual" reform model represented by the United States and other countries is also adopted by China. Reform path. Therefore, taking the Wells Fargo Bank and the Savings and Loan Association of the United States as an example to learn from the success and failure experience of American commercial banks in the process of interest rate marketization is conducive to the development of China's commercial banks. Finally, in response to the challenge of interest rate marketization to China's commercial banks, this paper puts forward the following suggestions combined with international experience: From a security standpoint, the state should improve the benchmark interest rate system and deposit insurance system, and banks should enhance risk awareness and establish from the perspective of liquidity.