Empirical Study About Joint-stock Commercial Bank's Capital Structures Affect On Their Efficiency

In recent years, the development of China's commercial banks is rapid. The growth of asset and profit is large. However, this over-reliance on deposit and lending interest rate to the rapid expansion of the traditional way to expand the size of China's commercial banks has led to huge capital gap, banks generally facing the "capital hard constraints" and this brings conflict. Small joint-stock commercial banks in China is essential and is an important force to China's banking industry .It is superior to state-owned commercial banks in the governance mechanisms, operating performance, asset quality and so on.This paper is based on theory of capital structure; the mechanism that capital structures of the commercial banks have impact on the operating efficiency is discussed. The commercial bank's capital structures affect the bank's operating performance directly, or by affecting the governance structure, governance structure has an impact on bank performance, thus the capital structures of banks have indirect effect on operating performance of banks . Among them, the efficiency is the embodiment of business performance. This paper argues that the financial indicators which is generally used by scholars to measure the performance is relatively one-sided, so a DEA-derived efficiency value is used to instead it.On this principle, this paper uses DEA method to measure the efficiency of China's four state-owned commercial banks and ten national joint-stock commercial banks with the data of 2002-2009, the empirical results show that the average efficiency of joint-stock commercial banks higher than the state of four large commercial banks, through the decomposition of the measured efficiency it can be conclude that the size of the efficiency mainly due to the difference between the two.Furthermore, use the measured efficiency value previously as the parameter , types of proxy variables of capital structure and some factors which effect to efficiency are used for explanatory variables to do the multiple linear regression analysis, the conclusions are like these: proportion of the largest shareholder, equity and balance degree in equity indicators have positive correlation to efficiency, proportion of top ten shareholders, ownership concentration is negatively correlated with the efficiency. Of the risk variable indicators, core capital adequacy ratio was positively correlated with efficiency. Indicator variable of the relationship in capital structure that ratio of the subsidiary capital shares net capital has an weak positive correlation with efficiencyFinally, according to the regression conclusion recommends are following these: standardize the set of equity , improve corporate governance; diversity the expansion of subsidiary capital,optimize capital management; Establish the mechanism of capital market to achieve business strategy and some other measures to make it sustainable, healthy and steady.