Research On Competitive Power Appraisal Of China Commercial Banking Industry

Since China has entered into WTO and undertaken to fully open its financial industry by year 2007, China's commercial banking industry is facing more severe competition while the foreign banks invade into china market. How to face this situation is really an urgent problem for each of us.Starting with theoretical analysis of enterprise competition in economics field, with integration of statistics, economics and financial as well as and fiscal management, this thesis chooses 4 state-owned commercial banks and 10 stock commercial banks and uses multi-analysis methods include factor reduction and corresponding analysis as well as regression to clearly investigate china commercial banks' major problems in respect of competitive power.Through comparing with international banks and based on the empirical analysis, the study makes a conclusion that our commercial banking industry's competitive power is low owing to the following reasons:(1) Compared with stock commercial banks, the state-owned banks are straggler in respect of quality of assets, safety and stability of management and ability to make profit. State-owned banks have not pick up adequate reserve for the risk assets. As the stock commercial banks expand rapidly in scale but ignore the accumulation of principal, there still remain latent risks in the development of stock commercial banks.(2) Compared with advanced foreign commercial banks in the international market, our commercial banking industry's competitive power is very low due to the monopolization of state-owned banks. While state-owned commercial banks have accumulated large amount of bad assets, there will be a hidden problem that financial hazard may occur in our country.Finally, this thesis puts forward countermeasure to enhance competitive power in our commercial banking industry.(1) State-owned banks should build a sound risk management system to avoid loss.(2) State-owned banks should establish a normal principal supply channel.(3) Our banking industry should strengthen the development of financial innovation product to increase means of making profit.(4) There should be different strategy among state-owned banks and stock commercial banks. The former should take international development strategy while the latter should take diversity strategy.(5) Financial supervise authority should strengthen supervising to build a favorable competitive environment.