Efficiency Research On China's Foreign Shareholding Commercial Banks

There are still many problems existing to affecting the competitiveness of China's Commercial Banks. Yet these problems can not completely be resolved by banks themselves in the near future, and they need the help of external forces and resources. The banks of Western developed countries experienced several hundred years of development, with the establishment of corporate governance structure and rich experience in bank management. So the admission of foreign strategic investors may be a good attempt. Will the entry of foreign strategic investors really improve the efficiency of China's Commercial banks?In this paper, the contents of five parts answer the question. The first Part,summing up foreign and domestic study and constructing the research framework. The second part, the paper concludes the characteristics of China's Banking sector, recalled the history of foreign investment in China's Commercial Banks, and study the strategic motivation of all related parties. In the third part, based on the situation of our country, the paper collects the foreign and domestic experience of introduction of foreign capital in the banking sector, analysis the success or failure of these cases, and provides reference observations for the reform of China's Commercial Banks. The forth Part introduce the DEA evaluation method. At last, through a DEA model analysis and Linear Regression measurement methods, the paper analyzes the efficiency change of China's Commercial Banks before and after the entry of foreign strategic investors, and evaluates the effect of foreign shareholding for China's Commercial Banks during 2002 to 2006. The outcome of the evaluation is analyzed.Through the research of efficiency evaluation of foreign shareholding China's Commercial Banks, on the one hand, domestic banks can carry on the rational and careful selection of foreign strategic investors, and guide the foreign capital to play a positive role without losing control; on the other hand, it can provide the reference for the policy makers and supervising department to formulate relevant policies and strengthen the management.