| Financial innovation is the reform of upsetting a balance, inventing something that has not yet been discovered in a market, resulting from the giant changes of financial circumstances. China' s WTO Accession and financial system reform bring a golden chance to China banks' financial innovation. Foreign banks regard China as a huge, underserved market. Compared to domestic banks, foreign banks are more experienced in financial innovation. Limited by their branch network, foreign banks may have difficulties competing with domestic banks in the mass market. However, they may be more successful in providing customized services to higher income customers, they will rely more on innovation advantage than size to win business. Innovation has become the foundation for modern international financial competition nowadays. Only make our strategies centering on innovation can China banks gain sustainable competitive advantages. If China banks could not make full use of financial innovation to nurture the development of management system and operation efficiency, they would find them in a passive predicament surrounded with foreign banks and would not play a pivotal role in supporting the country' s long-term economic development.China banks' current passive situation against foreign banks' competition is resulting from both internal and external restrictions to financial innovation. By building an innovation system, China banks can accelerate the development of financial markets, improve the management level, and form the competitiveness at the core.The necessary sections chosen from the mass financial innovations for China banks to Build up china banks' innovation system which is composed of foundation (property right innovation, operation system innovation, financial regulation innovation, financial market system innovation), premise (viewpoint innovation, structure innovation, management system innovation) and center (product innovation, service innovation). |
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