A Study On X-Efficiency Of State-owned Commercial Banks In China

In our country,the state-owned Commercial banks will face more challenges,as the foreign banks were authorized by the CBRC to set up the corporate bank in our country.At the present,the primary mission of our state-owned Commercial banks in their reform is how to make themselves to be more effective and competitive.To study the bank's competitiveness is essentially to study the bank's efficiency,that is,how to gain maximum benefits with the least input.X-efficiency is used to measure the management level when the output was given,the technology,the human resources and other properties produces were inputs.This article analysed the cause of state-owned Commercial bank's efficiency ranking in Chinese Banking industry and low efficiency from X-efficiency's angle,and this is of profound theoretical and practical significance.The basic method adopted in this article is to combine the theoretical analyses with the demonstration proof-test.This paper is employed DEA model,to evaluate the X-efficiencies,technical efficiency and allcocative efficiency of 74 Commercial banks in our country in 2003-2009 based on theoretical analyses to the X-efficiency,analyse and find the root cause of state-owned Commercial bank's efficiency ranking in Chinese Banking industry and low efficiency.The main conclusions of theoretical analysis are as follows:First,the rational choice theory indicated that Commercial bank's managers and operators'demand of"the superego"are not satisfied easily,because their press is low and they are attracting less attention,a person was unsatisfied to the work and this cut the bank X efficiency;Second,The analytic results of"Carte-Blanche"preference principle show that incredulity among commercial banks'trustee and the agent will lead to banks'X-efficiency.Third,the Individual effort equilibrium theory shows that the unreasonable incentive structure and promotion system will cause the staff not to be able to obtain the corresponding drive and the development opportunity in the work,will thus adjust own restraint level in the inertia region,and they may make less effort,thus low the bank's efficiency.Fourth,the group effort equilibrium theory shows that banks with larger scale will creat too many management and complex interpersonal relationship,this will cause the rigidity of the staff's hardwork to be big,so it has brought the efficiency waste and the loss to the bank;Fifth,the analytic results of effort game theory show that the incredulity between management bank and working bank can lead to X-efficiency;Sixth,enterprise effort equilibrium theory emphasizes that the enterpriser aptitude is very important.In our country,the bank president takes charge of the whole bank and this is a kind of"Bureaucratic Structure", it causes state-owned Commercial bank's leaders not to play entrepreneur's role fully, thus X-efficiency is low.The main conclusions of demonstration empirical analysis are as follows:First,classify the China Commercial bank according to the characteristic of ownership,finally we find that the state-owned Commercial bank's X -efficiency is lowest,the Industrial and Commercial Bank of China and China Construction Bank 's X-efficiency is higher than the Agricultural Bank of China and the Bank of China. The Foreign bank's X-efficiency is highest,the other four kind of bank's efficiency is intermediate,the efficiency level is close to each other through comparison;Second, the X-efficiency level of the Banking industry in our country is not high, from 2003 to 2009,The gap of the X-efficiency level between the state-owned Commercial bank and other type bank is reducing, the banking industry is highly competitive;Third, the main reason of the state-owned Commercial bank's low X-efficiency are low allcocative efficiency and low scale efficiency,while the reason of the other bank's low X-efficiency is merely low technical efficiency,for their allcocative efficiency and scale efficiency are high.Based on the above analysis,we thought that shortage of the management level in human resources and the unreasonable property right structure of the state-owned Commercial bank creat the low X-efficiency.In view of the above opinion,we give advice to improve the X-efficiency of China's commercial banks.Firstly,optimize resource allocation,and establish humanism management, for example,establish reasonable incentive structure and promotion system,creat"humanist"bank enterprise culture,creat new banker system and so on;secondly,promote the reform of the state-owned Commercial bank,perfect the Property Rights Institutions and Governance System of the state-owned Commercial bank;Finally,carry on the reform in the management and make the state-owned Commercial bank's organization flattened.