A Study On Performance Evaluation Of Commercial Bank

Following the gradual liberalization of financial market and the continuous deepening of financial establishment reform, China's domestic banking industry is undergoing enormous and far-reaching transform. On the basis of gradually improved managing mechanism of China's commercial banking corporation, establishing and improving effective incentive bounding mechanism is an important procedure to reach the goal of banking reform, while evaluating performance scientifically is the pre-condition to establish and improve effective incentive bounding mechanism. This essay has done a research in how to evaluate performance scientifically in China's commercial bank, by elaborating how Economic Value Added(EVA) index can accord with the demand of modern commercial bank, and that establishing and applying performance evaluation system with EVA as its core index will do great contribution to the establishment of effective incentive bounding mechanism. The structure of this essay is: in Foreword, explaining the purpose and main idea of this essay. In Chapter One, expounding the meaning and role of performance evaluation in bank management, as well as introducing the status quo of performance evaluation in China's banks, by emphasizing in the necessity of improving performance evaluation. In Chapter Two, introducing methods of bank performance evaluation abroad, discussing EVA theories, while emphasizing in advantages and disadvantages of applying EVA in performance evaluation. And, in Chapter Three, discussing some EVA applying case and its enlightening. First, It introduced and analyzed the real case of China Construction Bank (CCB) of applying EVA in performance evaluation, by explaining its background, purpose and effect, and by illustrating the existing problems and improvements. Secondly, it summed up some experiences, and put forward 5 suggestions regarding establishment and applying performance evaluation system with EVA index. Finally, in the summary, it gave the conclusion, and explaining the difficulties run into by the author in writing this essay, as well as the direction of further study and research.As a common staff in the line of financial management in banking, the author dared himself with meager knowledge to finish this essay, with hoping to give references to establish scientific performance evaluation system in domestic banks, and to improve performance management and incentive bounding mechanism.