Research On Influence Of Ownership Structure To Performance Of Chinese Commercial Banks

Since China joined WTO in 2001, facing the increasingly acute competition with the entry of foreign banks, Chinese commercial banks need to improve their operating performance badly. Ownership structure is the basis of corporate governance. Its legitimacy, to some extent, determines the effectiveness of corporate governance. Therefore, Chinese commercial banks have started the shareholding system reform since 2004.Because most of Chinese banks developed from sheer state-owned enterprise, with grasping innovatively the clue of state-owned shares'changes, this thesis explores how the state-owned and other kinds of shares infect the commercial banks'operating performance and what kind of ownership structure is most suitable for Chinese commercial banks'development.This thesis firstly had a review on the previous studies. Beginning with the concept, the second part analyzes the relationship of the ownership structure and corporate governance theoretically. Research has shown that the ownership structure is the basis of corporate governance. It can impact corporate governance mechanisms directly. Different Ownership structures have different effects on corporate governance mechanisms, and different effects on operating performance as a result.In the third section, the thesis illustrates that state-owned shares'changes is the major motivation of banks'ownership structure changes in Chinese commercial banks. Furthermore,9 Chinese commercial banks'unstructured panel-data during 1999-2008 is used to analyze the relationship between ownership structure and performance, the main results is as follows:The stronger mutual constraints among the substantial shareholders are, the better bank's performance is. In general, the effect of state ownership on bank's performance is positive. However, their relationship presents one asymmetrical "U" curve, which's left is lower than right. In addition, the foreign shares have aggregate negative effect on the banks'operating performance. Furthermore, the thesis elaborates how the asymmetrical "U" curve is formed in the macro and the micro aspects respectively, and infers the relationship of corporate shares (including the foreign shares) and banks'operating performance from the examined conclusions.Finally, in the last part, centering on the state-owned shares, the thesis presents some suggestions which could help arrange the bank's ownership structure more reasonable and diversified.