A Study On The Signal Transmission Theory Of Dividend Policy Of China 's Listed Commercial Banks

As dividend policy is one of the three core policies of companies’ management,scholars of Western and managers of companies have studied it so many years.Signaling theory is one of a way to explain it. The theory think that the dividend policy is a better way to demonstrate the performance of a company compared to accounting profit. The reform of tradable share promote the development of China’s capital market and improve the corporate governance performance. As an improving number of company pay more attentions on the dividend policy, the scholar of domestic university want to find different way to explain dividend problem. Besides,they try to illustrate which way to distribute profits can be beneficial to the company.As the speed of global economic decreases, it is more important to study the dividend theory.In this paper, it uses 16 bank companies’ data of Shanghai and Shenzhen listed.Because the bank industry is the one of most steady industry which can distribute dividend in a long way. Firstly, this paper will introduce the detail of these 16 companies and use CAR method to analysis the signaling theory. What we can conclude is that: in China’s capital market, different dividend theories can have different reflects; dividend theory can help investor to know more performance of company. Although our bank companies have long higher payout ratio, the manager should pay more attentions on future development opportunities and give the right news of companies to investors.