Sound Operation Of China's Banking Sector In The Financial Context Of Globalization Studies

Sound operation is the traditional tenet of banking, yet, the understanding to sound operation is not identical, what's worse, the understanding is false or half-baked sometimes. False or half-baked operation tenet will bring about the effect of misdirection, impair the stability and development of banking ,even the whole national economy. The paper gives a new explanation to the meaning of banking`s sound operation, points out that comprehending and implementing sound operation correctly is the only option of the developing countries` banking, under the background of globalization. Yet, the main objective of the paper is to explore the importance of banking`s sound operation to Chinese economy, which is blending into the global economy gradually, especially the fatal strategy significance to China's peaceful rise by way of utilizing the opportunities, which brought by globalization. At the same time, makes a quantitative analysis on the situation of China's banking, advances the countermeasures and suggestions to enhance the sound operation of China's banking systematically, so as to promote China's great power strategy implemented smoothly and successfully. The paper comprises introduction and 8 chapters. Chapter 1 briefly discusses the origin and embodiment of financial globalization, points out the strikes to the developing countries` banking, these strikes include adverse outer circumstance, the enhancement of dummy and foam of economy, and the enhancement of information's asymmetry, etc, which brought by financial globalization, puts forward the idea that the developing countries` banking can only through comprehending and implementing sound operation correctly to achieve survive and development, under the background of financial globalization. Chapter 2 expatiates the meaning of banking`s sound operation, under the background of financial globalization, points out that banking`s sound operation is the integration of stability and fitness, and stresses its dynamistic, emphasizes that under the background of financial globalization, some banks will lost safety and stability, if they lack go-aheadism, development or efficiency. Analysis the factors which affect the banking`s sound operation, such as institution, bank's public relationship management, etc, at the end of this chapter, advances the approaches of qualitative analysis and quantitative analysis on how to measuring banking`s sound operation. Chapter 3 reviews the relative theories, on purpose of searching the origin that leading to lacking soundness of banking`s operation. These theories include financial internal fragility theory, information unequilibrium theory, etc, which analysis the impairment to the sound operation of banking from the angle of financial internal fragility, information's unequilibrium, the psychology and behavior of banker, depositor,etc. Chapter 4 analysis the important significance of banking`s sound operation to the sustainable and speedy growth of Chinese economy, under the background of Chinese economy's blending into globalization, puts forward the viewpoint that banking `s sound operation can provides the conditions, which are needed for Chinese economy's sustainable and speedy growth, these conditions include stable economic environment, sustainable assets accumulation, techelonogy advance and innovation. What's more, banking`s sound operation can also pull economic growth by way of development of itself, becomes an engine of Chinese economy's sustainable and speedy growth, so far as to reduce the fluctuality, maintain the sustainability of Chinese economy's speedy growth. Further more, taking the actual economic and financial position of China into account, when we implement the strategy of sound operation to enhance the international competitiveness of China's banking, we should attach importance to "fitness", namely, the quality and benefit-oriented development. Chapter 5 points out that the successful implementation of China `s great power strategy depends on the net profit, which brought from China's blending into globalization, and the net profit depends on the international competitiveness of China's banking sector. Understanding and handling the relationship between sound operations and enhancing international competitiveness correctly, enhancing the international competitiveness through sound operation to achieve survival and development is the only option of China's banking . At the same time, by way ofpromoting the global operations of banking and some other sectors, increasing China's gains brought from globalization, such as overseas assets revenue, expanded foreign trade benefits, etc, decreasing China's cost resulted from blending into globalization, for example, the huge loss caused by financial crisis. Chapter 6 makes a quantitative analysis on the situation of China `s banking. The result is: as a whole, China's banking`s operation is short of soundness, and this mainly resulted from the state-owned commercial banks` bad performance. The state-owned commercial banks` bad performance is as follows: low efficiency, high ratio of non-performing assets, decreasing market share. The joint-stock commercial banks` operation is soundness basically, but the ratio of non-perform assets should be decreased continuously, and the efficiency of operation should be improved. The reasons that cause China's banking`s lacking soundness are planned economy's negative effects, bad social credit environment, etc, which will impair Chinese economy's sustainable and speedy growth, impair the net profits brought from globalization seriously, and impair the smooth and successful implementation of China's great power strategy ultimately. Chapter 7 puts forward the countermeasures and suggests on how to enhance China's banking`s sound operation, from the angel of macroscopic. For example, improving banking`s assets quality by improving the social credit environment; replacing the connotative state guarantee by founding deposit insurance system; making up external superviance`s deficiency by strengthening market discipline; riding the problematic bank's negative external effects by handling the problematic bank correctly, etc. Chapter 8 advances the countermeasures and suggestions on how to enhance China's banking`s sound operation, from the angel of bank. For example, establishing the perfect corporate governance structure and capital complementary mechanism by share-holding or even listing; improving assets quality and profit index by modifying the structure of business; controlling risk and hasting development by imposing RAROC, CRM, ERM; and attaching importance to R&D; controlling moral hazard and decreasing cost by imposing IT positively; implementing the strategy ofmultinational operation prudently, hasting China's banking`s development, and avoiding impairing its soundness.