X-efficiency Of Commercial Banks In China Empirical Research

With the all-sided open of Chinese financial market and international financial merging booming, the competition of Chinese banking industry becomes more and more complicated. First, This paper employs DEA to evaluate the scale economy, pure technical efficiency, allocative efficiency and total efficiency of Chinese nationwide 14 commercial banks, foreign banks and city commercial banks. Second, we use Malmquist index to calculate productivity index, which can reflect the dynamic efficiency changes of Chinese commercial banks, it equals to multiplication of technical changes and technical efficiency changes, and then composite them generally. At last, we establish econometric model and use E-views3.1 to analyze the regression relations between input factors and overall efficiency to find out the key factors, which affects the overall efficiency of Chinese commercial banks. As a result, we found that the overall efficiency of Chinese commercial banks keeps increasing, the overall efficiency of joint stock and foreign banks is higher than state-owned banks, but the gap is shrinking. The regression result has shown that commercial banks' management level, profitability and innovation are the main factors that influence commercial banks' efficiency. So internal commercial banks should grasp the key points above to improve the efficiency thoroughly to achieve quick and stabilizing development.