An Empirical Research of the Effects of Non-interest Income on China's Large Commercial Banks

The empirical research observes the effects of internal features and external factors on the large commercial banks' noninterest income by analyzing the panel data of China's five large commercial banks from the first quarter of 2002 to the third quarter of 2011 by using Fixed Effects Cross-section Model. The results suggest the following three relations. First of all, there is a significantly positive relationship between the expansion of noninterest activities and that of bank's scale. Secondly, there is a markedly negative relationship between noninterest income ratio and the increase of return on assets, foreign banks' size and social needs of financial management. Finally, the size of non-bank financial institutions in China has no significant effect on noninterest income ratio.