Chinese Banking Market Structure, Ownership And Performance

With the opening of Chinese banking market and the rapid of theprocess of the stock-shared systems' innovation in the state-ownedcommercial banks, one of the fundamental problems China is faced withis to enhance performance of the Chinese bank industry. The article baseson the theory of industrial organization and some related researches, thenanalyzes that market structure and property rights influence the Chinesebanking performance. The thesis tries to find a regime that can promotethe performance in banking market. 1.Main content and viewpoint This thesis consists of six parts. Preface, it introduces the purpose of the thesis and the approachesapplied in the research. Meanwhile, the area of research is determined inthis part. The first chapter reviews some related researches, and is thetheoretical basis of the thesis. It is divided into three parts. To begin with,it introduces the development history of industrial organization theory.Secondly, the thesis mainly illustrates the theoretical frame of analysis,such as SCP frame. At last this chapter reviews some related researcheson foreign banking and references about market structure,property rightsand performance in banking market. The second chapter interprets the relation between market structureand performance in the Chinese bank industry. It firstly analyses themarket structure of the Chinese bank industry by market shares andconcentration ratio. From the results, we find that oligopoly is present inthe Chinese banking market. The market concentration is very high, butthere has been a steady decrease in the concentration ratio. The next stepis to determine the relationship between market structure andperformance. The thesis points out that there is negative statisticalrelationship between market concentration and performance. Moreover, itfinds out economy of scale exists in the middle sized banks. The thirdstep, the chapter continues to discuss the reasons why market structure ofthe Chinese bank industry leads to the low performance. The third chapter mainly discusses the relation between propertyrights and performance in the Chinese bank industry. It consists of threeparts. To begin with, it introduces the definition about property rights andproperty right system of bank, and then illustrates main kinds of propertyrights structure and shortcomings of property right system in Chinesebanking market. In the second place, the thesis researches how banks'property rights influence performance. In the last part, the article mainlyintroduces the property right system and process of the property rightsinnovation in foreign state-owned commercial banks. The forth chapter researches the relation of market structure,property rights and performance in the Chinese bank industry. The thesisanalyses the relationship between market structure and property rightsthat influence banking industry performance together. At the meantime,this chapter demonstrates it is necessary that some measures improvingperformance should be found out from the system consisted of marketstructure and property rights. The last chapter is the conclusion and suggestions. Based on theabove analyses, some suggestions are made in this paper: firstly, ourgovernment should propel the property rights' innovation in state-ownedcommercial banks. Secondly, market structure of the Chinese bankindustry should be regulated, such as enlarging the foreign capital banksto increase competition. Last but not least, the financial supervision isenforced to keep the banking system stable. 2. The contributions of the thesis Most of the thesis that apply the theory of industrial organization toresearch Chinese bank industry demonstrate the relation of marketstructure,property rights and performance. It expands the original frameof analysis in industrial organization theory. The article puts forward themeasures in combination with market structure and property rights. Bothare indispensable. The thesis applies numerous recent statistics in demonstration. Itpromotes reliability and preciseness of th...