Competitiveness Research Of Listed Banks Based On The Competitiveness Equation

With China's WTO transition period has ended and the opening up of financial industry to the outside world, the domestic banking industry is facing an unprecedented complex environment and fierce competition; Meanwhile, the ever-changing needs of diverse customers, also brought tremendous challenges to the banks. Meeting with a lot of competitive pressures, China's commercial banks need to improve their competitiveness, to seek greater development in the fierce competition. The listed banks in China-Shenzhen Development Bank, Shanghai Pudong Development Bank, China Minsheng Bank, China Merchants Bank and Huaxia Bank ,are discussed as a competitive evaluation topic in this paper. Based on the competitiveness equation: listed banks competitiveness = listed banks competitive assets * listed banks competitive process, this paper makes an objective evaluation of the competitiveness for these five listed banks in 2004 and 2005.Taking into account the listed banks' unique characteristics of listed banks- they faced with the risk of stock price fluctuations, this paper introduces an indicator (VaR) to measure market risk in the the competitive assets model, and uses factor analysis evaluation to get the competitiveness assets index; In the competitive process research, this papers introduces the nonperforming loan rate as risk information to the DEA model, then uses Scores to obtain the competitive process index based on DEA efficiency indicators and growth indicators. Finally, the paper uses the competitiveness equation to get the competitiveness index of the listed banks. The results showed : in the comparison of competitiveness, Minsheng Bank of China ranked first in 2004, and Shanghai Pudong Development Bank ranked first in 2005; Shenzhen Development Bank and Huaxia Bank are relatively weak, also a big gap between the other three. The paper made recommendations on how to improve competitiveness for the listed banks at last..