On The Cooperative Competition Between Commercial Banks In The Opening Market

The cooperative competition between chinese and foreign commercial banks become a reality with the morden market economy and the development of internantiona financial. For expanding market shares and pursuing profit maximum, Chinese and foreign banks abandon traditional pure competition mode, and choose a modern mode which is called cooperative competition. These banks can have different extent cooperation by holding shares, technology cooperation and strategic alliance. Taking advantages of copartners funds, technology and human resource to make up self developing shortages, they can rapidly improve competitive advantages in short time.Since last centure 50s, research on game theory of banking cooperative competition has made big development. Studying on cooperative competition between Chinese and foreign banks has relativly mature progress after China joining WTO and opening banking market. The progress involve verifying the necessarity and possibilty of this competition mode and how to choose specific mode. However, this research hasn't discuss the critical point between cooperation and competition, didn't develop a new mode. Furthermore, the research is less of sysmetic explaination on problems which are caused by practice.Analysis methods of game theory suggest that players should reasonably apply strategies to get payoffs under setting rules. The ponit of cooperative competition is the motivation of cooperation is to transfe predominace among enterprises and achive long-term maximum profit. Combine the two matheods, it is possiable to finde the best strategy in the process of cooperation thus to get the comparative and continuous advantadges. In this process, the most important thing is to comfirm the collabrators, the competitors and the specific ways.Entering the 21st century, along with the fast implementation of financial globalization, all kinds of international financial organization adopted much more internationalization on their businesses. Besides, the Chinese banking market has been fully opened towards outside world according to the requirement for Chinese membership of WTO. That means all the above incidences ask for a rapid development of competitiveness from Chinese commercial banks, calling them to reduce operation risks, to develop oversea market rapidly, to shrink the technical and management gaps between themselves and overseas counterparts, and to eliminate malicious competition. Cooperative competition is much effective and cost saving compared with non-cooperative competition, and becomes the obvious choice for Chinese banks and their overseas partners.Recently, people see much significant improvement on the cooperation environment of Chinese banking business. For example, state-owned business banks has change their organization into shareholding or public listed companies, relative laws and regulations has been improved, the state enhances its supervision on banking organizations. Besides, Chinese banks has more developed operation networks, capital, long-term clients and governmental supports while the foreign banks emphasize on human resources education, financial creativity, internal operation management, thus they could help each other by cooperative competition through an effective adoption of interest and cost dividend.Most possible cooperation between Chinese and foreign banks appears in the field of liquidation of capital, investment trust, consumer credit, international financing, trust bonds sales, which can be shareholding, technical supports, management cooperation. However, which individual partner is most suitable for them? The Chinese banks must consider whether their strategies are similarly in common, whether their strengths can support their cooperation, whether they act together, whether they have similar enterprise cultures, whether they are equal, and whether the cooperation brings benefits for both. An international CCC index should be used to evaluate the potential partners. In fact, the current situation is still not so good, since there are many problems arising from different view of ownership, risk evaluation, and interest dividends.To achieve a competitive edge, the Chinese banks need to improve their abilities to minimize risks arising from cooperation with overseas counterparts; they need to improve finance regulations, to adopt right viewpoints on interests, to evaluate flexible cooperative methods, and to improve human resources management. So there will be healthy competitive competitions between Chinese and foreign banks and bring benefits for both.