| Studies on investment value of state-owned banks are difficult problems faced scholars around the world. Researches in the transition process of China's investment value of state-owned banks, even more difficult, only because that the state-owned banks run completely different characteristics from market-sense commercial banks. What State-owned banks differ from commercial banks, in general the most essential characteristic is that the owner of state-owned banks is the Government. Social objectives are in priority to economic objectives, the Government would finance to those invalid project, such as providing employment, maintaining social stability, as well as other stakeholders.Political gain, need to compensate for the economic costs. State-owned banks with interference on operations generally have a high rate of non-performing assets. This is rooted in the special way the government access dividend to state-owned banks. After the 1997 Asian financial crisis, the Chinese Government has come to realize that the cost of this act, that a healthy banking system sound more in line with the long-term interests of the country. A series of reforms of state-owned banks such as implementation of the divestiture of assets, financial restructuring, the shareholding system reform and IPO timely, which opened the transition process of state-owned banks'operating mechanisms from a planned economy to a market economy system.A fundamental problem is that the system of state-owned banks in the transition process, along with changes of the functions of state-owned banks, operating mechanisms, how to re-evaluate the value of state-owned banks is a serious challenge. The most impact of transition is that in different institutional environment of state-owned banks, measuring must have different criteria. A universal point is that, China's banking sector is inefficient. Therefore, such reasoning seemingly right but wrong, because they lack of deep understanding of Chinese state-owned banks in economic transition process.It is undeniable that there are series problems in the transition process of China's state-owned banks, but they are endogenous rather than primarily due to poor management of the bank itself. Studies (Zhang Jie, 1999) show that China's non-performing assets of state-owned banks are mainly because of the cost of economic transition. People's Bank of China's survey conducted in 2002 tells: state-owned banks'non-performing loans can be attributed directly or indirectly to influence of the government accounted for 80%, and state-owned banks operating losses caused by errors in all the non-performing assets accounted for only 20%.It must be noted that with the continuous advance of the reform process, China's state-owned banks gradually transfer from bad bank" to the "good bank". Since the year of 2000, China's banking sector continued to grow on business scale, the four state-owned commercial banks continued to improve operating efficiency. On the other hand, in the aid and under the combined effect of their own efforts, state-owned commercial banks dropped the size of non-performing assets. Significant improvement in asset quality, management continued to reduce risk. Overall, both the scale of growth, profitability or asset quality, risk control, such as changes in the trend of the core indicators are showing good growth, strong profitability and tremendous growth potential, with good conditions for sustainable development and higher investment value.On that background, this study would try to resolve four issues: (1) system before and after the transition, the system in different circumstances, the behavior of state-owned banks, operating mechanism, the value of the target, such as the existence of fundamental differences, what are the intrinsic factors of value of China's state-owned banks? (2) China's state-owned banks are rooted in socio-economic environment of the specific system, have a variety of distinctive personality and characteristics of the system. And what are special factors in investment value of China's state-owned banks compared to western commercial banks? (3) China's state-owned banks have profound institutional characteristics, also in the system of the special transition period, how to assess the investment value of the Chinese state-owned banks? Answers of these three questions, together constitute the research topic of investment value of China's state-owned banks under characteristics of transition.In this study, we would mainly do theoretical analysis with finance theory, economic theory, finance and accounting theory, combining qualitative analysis with quantitative analysis. And we also use comparative analysis and the systematic analysis, based on factors of investment value of state-owned banks in-depth, to establish the transition model of the investment value of China's state-owned banking in line with the characteristics. Then, respectively, we would also do some empirical testing with the investment value model of Chinese state-owned banks. In this study, the composition is of a total of seven chapters, the main contents and conclusions are as follows:(1) The existing theoretical studies of investment value are reviewed. A detailed review of the relevant theory of the investment value, summed up various investment models and methods of evaluation and analysis of the banking sector in particular, research on specificity of the investment value of China's banking sector.(2) Based on the characteristics of state-owned banking system in transition, we analysis the basic factors of investment value of China's state-owned banks. There are four aspects: firstly, the state-owned banks'sustain of empirical on economic growth; secondly, the analysis of profitability of state-owned banks; thirdly, analysis of asset quality of state-owned banks, we would point out that non-performing assets of state-owned banks; fourthly, empirical studies of the operational efficiency of state-owned banks.(3) Focused on the premium of state-owned banks in the process of transition. These premium of state-owned banks comes from the external system features, such as the value of the privileges of state-owned banks, the " dividend" of state credit guarantee, and we would revealed the dual capital structure of the state-owned banks under the implicit credit guarantee system, as well as state-owned banks in the real capital of the "free rider" behavior.(4) With the phenomenon of a large number of current profit of the state-owned banks was used for financial burden of digesting the perspective of history, we reveal that accounting distortion of profits of state-owned banks. And then set up the basic pricing model of investment value of state-owned banks, as well as a premium option pricing model of the value of state-owned banks. They constitute theoretical models of the investment value of state-owned banking system in line with China's state-owned banks in transition characteristics. (5) We established theoretical models of investment value of state-owned banks, and do empirical tests of investment value with the Industrial and Commercial Bank of China, the Construction Bank of China and Bank of China,.In our study, study of the investment value from a system perspective of transition of China's state-owned banks is an innovation attempts. And compared to the related literature, this article's has three aspects of innovation as followings:(1) We establish a analysis framework of the investment value of state-owned banking system in line with a suitable transformation feature. Be different from western commercial banks and the general investment value, our study was based on a profound and unique characteristics of China's state-owned banking system. We consider that the investment value of state-owned banks comes from two parts: the basic premium and institutional factors of value. Among them, the basic factor is the mean value, without taking into account the unique socio-economic system in China under the conditions of environmental factors, purely state-owned banks as a financial enterprise value available. Refers to the premium, state-owned banks, as a living subject, has financial assets in addition to all other resources, tangible or intangible value. The two pars of state-owned banks together constitute the framework of investment value analysis.(2) A comprehensive analysis, in-depth excavation of the transition characteristics of the investment value of the basic and premium factor of China's state-owned banks. Firstly, we study the value of the performance in different areas of state-owned banking system before and after the transition, to build the intrinsic value of identity and historical continuity of the state-owned banks; Secondly, we analyzes a variety of institutional factors and the premium mechanism of potential value of the state-owned banks. Finally, we establish the investment value model of state-owned banks under a comprehensive excavation, in-depth analysis of state-owned banks in line with the transition characteristics.(3) Based on the historical process of gradual transition of China's state-owned banking system, we discuss from their non-performing assets, as well as financial restructuring, and come up with a large number of current operating profit for the financial burden of history to digest, as well as the added provision for loan provision in recent years, reveals distortion of the accounting profit in line with characteristics of the transition of state-owned banks. The point that distortion of accounting profits of state-owned banks, in practice, get rid of the traditional perception that the operation and management of state-owned banks, as well as misunderstanding of low achievement, then we establish the investment value model of China's state-owned banking system in line with the characteristics of transition integrated.
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