Research On Overseas Expansion Of Chinese Banks

At present, domestic research focus more on foreign banks after entering China than Chinese banks expanding to abroad. This paper mainly study characters and obstacles which cause Chinese banks’ expansion in overseas to suggest Chinese banks expanding to abroad. In order to make the paper more specific, two cases from the Bank of China are studied. By studying the expanding history of representative international banks from Europe, The US and Japan, following characteristics about global banks expansion are made as follows. Firstly, European banks lead the new trend of expanding in overseas. Secondly, the Asia-Pacific region is attracting more and more attention from these global banks. Thirdly, business diversification led by The US is becoming the major developing direction.After comparing The Bank of China with Industrial and Commercial Bank of China, Construction Bank of China and Agricultural Bank of China from aspects of overseas assets, profits, branches and staffs, we can draw the following conclusions: The Bank of China’s overseas expansion level is higher a lot than three of others from lateral view. Besides, its 87-year-old expansion history and increasing overseas assets, profits, branches and staffs are demonstrating The Bank of China is the leader in Chinese banks. Therefore, this paper makes conclusions about the characters of The Bank of China: Every little makes a nickel; become bridges to connect Chinese companies and overseas; precede expansion by setting and M&A. At last, the motives about Chinese banks’ expansion include internal and external Part: Interior Motives include the setting of strategic development and business diversification; External motivation includes the guidance of national policy and targeting country’s political, economic and cultural issues. The Bank of China also have to face these challenges unstable economic environment of the host country, regime change, cultural gap, multinational banks competition, limited management and other obstacles.Last but not the least, on basis of global and Chinese banks overseas expansion characteristics, there are four suggestions for Chinese banks to move forward abroad: making corporation with Chinese companies and regard it as your foothold; following national policy to expand into new markets with courage; developing diversified business models to enhance profitability; selecting target markets carefully to avoid risks.