Study On Corporation Governance Of The City Commercial Bank

In recent ten years, city commercial banks have made significance progress. At the same time, they are facing keen competition in banking industry and have reached a key stage of development. During Financial Crisis in Southeast- Asia, bank crisis took place in many countries. In China financial scandals in relation of the big-four state banks, share holding banks and city commercial banks turn up again and again due to inconformity of regulations and imperfect governance.We will discuss status, root-cause and solutions of problems. The discussion will start with theory of governance, involve analysis of governance models and give details of the governance of city commercial bank. Based on research of the status and the results incurred, we will introduce principal-agency model. Based on analysis of data and cases of the selected city commercial banks, we conclude that the root-cause of the inconformity of specifications and the imperfect governance is absolute control of the banks by local government, against which we will give a series suggestions of effective measures, including share holding as measure for improving internal control and supervision by CBRC as measure of external control.