Research On The Location Of Regional Banks

Since reform and opening-up, by deepening the financial system reform, the regional small and medium banks are making rapid progress. As of the end of 2008, China has 5308 small and medium regional banks which effectively support the economic growth. The national banks and regional banks are different in organization structure, governance structure and the geographical distribution of the branches. The latter's greatest advantage is the managers have greater decision-making power and they are better at deal with fuzzy information. In different region, the customers are different at two important dimensions:scale and informational transparency. The national banks have a comparative advantage over national banks in processing opaque information, so the geographical distribution of these banks' branches is different.Based on asymmetric information theory, principal-agent theory, incentive theory, we will bulid the theoretical framework of a regional banks location analysis and estimate it by Logit model. Selected as the research object, Zhejiang Province, examining the distribution of banking financial institutions, an overview of 8415 related to cities, counties and county network in rural areas, to the conclusion that:First, the various branches of the regional banks have greater self-management and decision-making power. Its advantage lies in the transparency of the relatively poor treatment of fuzzy information.Second, different types of banks have different distribution. Regional banks located in areas where the information is more fuzzy, for example the county and rural. In these areas, the numbers of regional banks'branches are larger.Third, the banks'advantage and the different distribution are determining by the banks themselves. Differentiation organization and governance structure determine different comparative advantages of banks, and they can't replaceable by each other.