Analysis And Empirical Study On Structure Of China's Banking Industry

After 30 years'opening and reformation,China's economy has been developing constantly with a speed which is over the same period an average annual growth rate of 6.8 percentage points higher than the world rate of growth, actual growth of income of urban and rural residents jumps by six times,the total trade volume ranks third in the world, the level of urbanization increased by 0.9 per year percentage point and GDP from 1.8% of the world rose to 6%, overall national strength from weak to strong, China's socialist modernization has scored brilliant achievements in economic and social changes have taken place in the historic.As the core sectors of the economy, financial sector, especially the dominant banking sector, has been rapid developed with the economic development. China's banking sector has been developing from weak to strong, from single to multiple, from monopoly to competition, from a planned model to a market type, from closed to open and has made outstanding contributions for the country's economic development. However, we should note banking industry structure, there are still many problems, which was lagging behind economic development. A long-term planned economy has brought banking sector at present absolute monopoly of state-owned banks, so that the structure of the banking sector is a single one, showing a state-owned banks dominate, which obviously does not match the requirements of a market economy; the strict limits with the access to the banking rejected the non-public economy. In recent years, private banks played a very important role and developed in a amazing tendency; China's banking industry structure, which have many issues such as lack of coordination with the economic structure, to a certain extent, restricts economic development.In the new situation of economic globalization, China's banking industry is not only facing the arduous task of further deepening the reform, but also exposed the pressure from international competition with mature multinational banks. In this case, optimizing the structure of China's banking industry has become an inevitable choice. Optimizing the structure of China's banking industry can improve the overall efficiency of China's banking industry and strengthen the banking sector's ability to distribute resources so as to enhance the survival of China's banking industry and competitiveness. In this background, we come to analyze the structure of China's banking industry in order to find the root causes of current problems and to resolve them, provide a reference for the banking industry's further reforms, has important practical significance.This article starts with the development of China's banking industry. According to characteristics of banking industry structure, this paper divides the period starting from the founding of PRC till now into following 6 parts:the establishment of the banking system, "Monolithic" model stage, diversification reform, primary reform stage, intensified reform stage, and finally the stage of reform and innovation. Features of each stage are expounded so can the structure formation process of China's banking industry be understood comprehensively. Then the reference on Goldsmith classical theory of financial structure is introduced into the banking structure, combined which with index system of financial structure, a number of indicators on the banking structure are built. As for analysis on present China's banking industry structure, a macro point of view is carried out to give banking structure a brief description. China's monetization ratio and banking-related ratios have been steadily improving, and the banking system is gradually self-perfecting as well. Changes in China's financial market is markedly out by banking sector-leading. Besides, direct financing developed lately, and its development experienced certain ups and downs. It's only till recent few years has it increased steadily. Next, this paper analyzes the differentiation issue of banking products dynamically. In the banking industry, homogeneity in product is a serious issue, but we can still find that product differentiation is gaining momentum. As for the inter-bank market, three dimensions including scale, efficiency and quality are adopted; correspondingly, asset indicators, efficiency indicators and non-performing loans indicators are taken respectively. In addition, soft environment which would affect the structure of the banking sector is introduced. We can get some conclusions and inspiration, based on a number of points obtained in this study course. Namely, reform and development of our banking industry must be focused on economic development; optimize the structure of the banking sector needs to improve the management level of state-owned banks at the same time we should vigorously develop other joint-stock as well as private banks, so as to establish the outer ring bank under the banking structure in the core of state-owned banks, to achieve a harmony with the economic structure with public ownership economy as the dominant economic structure and diversified economy as a supplement, and provide better services for economic development; keeping the banking structure stable also requires integrity of the relevant laws and systems, the stability of the banking sectors both to the immediate interests of the most depositors, but also to the country's financial stability. It requires more sound banking regulations, and the introduction and formulation of deposit insurance system.