China's Commercial Banks Operating Performance Evaluation System Theory And Empirical Research

Commercial banks are the important part in the financial field, they also play the supporting function to the development of the national economy. The bank system of China has been improved and the pattern of diversified commercial bank has taken shape because the reform of financial system have deepened since the reform and opening up of China. According to the commitment when we joined WTO, Chinese financial market will become more and more open, the banks will face unprecedented challenge. They will compete with not only the domestic banks but also big foreign banks. Under such circumstances, how to improve their performance efficiency and how to increase their competitiveness are essential for the local commercial banks. So, it is of great importance for them to study performance efficiency not only to better their own development but also to meet the competition from foreign banks.This paper takes 10 local commercial banks as the samples for study, evaluates the performance efficiency of these banks by using the principal component analysis, and compares the performance differences between these banks, then the paper analyses the reason for the differences and proposes the suggestion how to improve the performance efficiency.First, this paper reviews the general theory about the bank performance efficiency, summarizes the research results of operation performance of commercial bank, and introduces the research method and framework of this paper. Then it introduces the general concept and main models of performance evaluation of commercial bank. The paper also presents some problems of performance evaluation system for Chinese commercial banks. Then the paper designs a suit of evaluating indexes which involves quantitative indexes such as profitability, safety, fluidity, and growth as well as qualitative indexes such as internal control ability, sustainable ability, learning capability and competitiveness. Then it takes empirical analysis on the commercial bank's performance efficiency by using the method of the principal component analysis, the result shows that the ten banks performs differently on efficiency. Then it deeply analyses the reasons for the differences between the banks and proposes the suggestion to improve the banks' performance efficiency.