The Economics Analysis Of Franchise Value Of Chinese State-owned Banks

Commercial banks are the agent of socio-economic activities, and the intermediary of real economy and virtual economy. At the same time, its special structure of assets and liabilities determines that its operating activities are confronted with high risk. Therefore, commercial banks are the risk concentration of socio-economic activities. Usually, the risk behavior of commercial banks is related to its franchise value so that the research on its franchise value provides convenience to the research on the risk behavior of commercial banks, and helps to control the finance risk.After the market-oriented reform, Chinese state-owned banks face the same risk as other commercial banks. Through theoretical analysis and comparative study, this paper believe that the franchise value of commercial banks is composed of two parts, one part is the franchise value determined by the market-related factors, and the other part is the franchise value determined by the bank-related factors. Based on the two parts of franchise value, and according to the definition of franchise value, this paper construct a new measurement method to calculate franchise value of Chinese state-owned banks through comparing and evaluating the four usual measurement methods. And integrating with the theory of market segmentation in microeconomics, this paper makes analysis on the franchise value of Chinese state-owned banks in different times. Comparing the franchise value of Chinese state-owned banks in different times, this paper finds that during the monopoly period, the franchise value of Chinese state-owned banks is the highest, and the transforming trend of franchise value is to decline, this conclusion is consistent with empirical studies. Also, this paper finds that as the roaring development of finance liberalization and innovation, the declining trend is accelerating.However, all present researches on franchise value of commercial banks in China are under the background that there is rigid control in Chinese banks, which makes great contribution to the high franchise value of Chinese state-owned banks. Therefore, as the quickening of the market-oriented reform of Chinese state-owned banks and the further reforming of finance system of China, it is necessary to make a new investigation on franchise value of Chinese state-owned banks and make further research.