On Fragmental And Blend Banking System

The blend banking system regained its leading position throughout the Western countries in the 1990s. With its entrance into WTO at the end of last century, China will have an overall open banking market in 2006, according to relevant promises, Thus, Chinese financial world with its present fragmental banking system will undoubtedly face fierce competition of Western financial egcoons. Starting with "risk efficiency theory" and "special purposed assets theory" , the paper aralyses the "blend-fragmental-blend" transition process happened in the Western financial field, and points out its underlying reasons. After comparison of the two blend periods, the author concludes that blended banking system will be affected by factors of financial marketization, management of banking facilities, the financial supervision and law-governing environment, ect. It is necessary to carry out fragmental banking system temporarily under our domestic circumstances. But on consideration of our international environment, the blend banking system is our natural development trend.The current situation, with disadvantages like irrational administering structure by legal persons of financial instiutions, undeveloped securities market, insufficient financial supervision and imperfect financial rules, makes it impossible to carry out blend banking system immediately. The, the paper proposes a three-stage development strategy, and points out that our task at present is to creat convenient environment for transition, including establishing the supervisory efficiency, etc.