Abstract: Starting from the theoretical mechanism of profit sharing between finance and real economy, this paper reviews and analyzes the profitability of China's banking industry, and makes a horizontal comparison with the banking industry of the United States, Japan and Germany. Using the panel threshold model, it is found that there is a double threshold asymmetric effect between banking profits and the development of real economy. When the net profit margin of banking is less than 0.491%, improving the profitability of banking will inhibit the development of real economy due to profit plunder; In the range of 0.491% - 0.801%, the improvement of banking profits is conducive to the development of real economy, and they are in the most comfortable symbiotic state; When it is higher than 0.801%, the promotion effect of continuing to improve banking profits on the real economy will be weakened, but it is still in a symbiotic state of positive promotion. At this stage, the role of China's banking profitability in promoting the development of the real economy has shifted from the suboptimal state to the optimal range, thanks to the strong deleveraging and strict supervision of the Chinese government after 2016. By stepping on the brake in time and decisively, the financial industry was pulled back from the self circulation profit illusion, avoiding the adverse consequences of sliding to the edge of endangering the real economy.
