Profitability analysis of representative banks of China using the stochastic frontal boundaries method

Shen' Binbin, Perfiliev Alexander Aleksandrovich

In the modern economy, the scientific discussion about public control over economic processes has intensified. In this context, a scientific assessment of the PRC's experience from the perspective of rational economic behavior may be relevant. In the framework of this work, we draw attention to the importance of assessing profitability in the modern banking system. For the efficiency of the banking system, it is important to control the methods of regulation so that they do not negatively affect the banking business. If we talk about China, the problem of controlling the profitability of banks becomes important also because the financial market is subject to significant changes, which changes the environment in which banks operate. In the first chapter of this work, a theoretical study of the profitability of commercial banks by the SFA method is carried out. In the second chapter of the work, the profitability of commercial banks of the People's Republic of China is determined, multiple linear regression analysis and the method of stochastic frontal boundaries are described, with the help of which factors influencing the profitability of the capital of commercial banks of the People's Republic of China are identified. In addition, the procedure and results of the empirical analysis of the banking system by the SFA method are described.

Keywords:commercial bank; profit; liquidity.