The Research On The Efficiency Of Bank Of Jiangsu's Branches

The research on improving banking efficiency has been one of the most important issues for the international financial field and every supervisory authority over the last decades. The efficiency of commercial banks is to minimize the input or maximize the output. Jiangsu province is one of the big economies in China, the credit funds is the necessity of its development. Except the funds from state-owned banks and large joint-stock commercial banks, the funds from city commercial banks have become an important part of supporting the development of Jiangsu's economy. So we will start from the city commercial banks to analyze the methods that raise their efficiency. It is necessary measures to ensure the Jiangsu's economic development in a sustained and steady way.The paper has chosen the Bank of Jiangsu, as a representative of city commercial banks, to analyze the relative efficiency of the ten branches of Bank of Jiangsu, and deeply figure out the important factors. So. the paper continues on the topic.There are five chapters in this paper:Chapter One introduces the background and the meanings of the research, and then summarizes the domestic and foreign research papers, clearly point out the contents, methodology and the main frame work of the paper. Chapter Two introduces the methods of measuring the efficiency; the main point is to introduce the DEA. Chapter Three and Four are the most important ones. Chapter Three is to measure the Bank of Jiangsu's ten branches' technology efficiency, pure technology efficiency and scale efficiency, and point out whether they are in increasing range or decreasing range from Year 2007 to Year 2009. We define net fixed assets, operating expenses, deposits as the input variables, and loans and total profits as the output ones; according to the results, we compare the results among the ten branches in horizontal and vertical ways:analyze the differences among them and initial improving methods. Chapter Four analyze the factors affect the efficiency of the branches:we first summarize the potential internal and external factors. On the consideration of the real situation of this research and the receivable data, we further choose the six factors to analyze how much the factors' influence are and how they acts. The six factors include intermediary business income, quality of human resources, loan-deposit ratio, nonperforming loan ratio, asset size, and return on assets. We finally get that intermediary business income, nonperforming loan ratio and asset size are the three important factors, besides, the intermediary business income and asset size are positively related to the efficiency, while the nonperforming loan ratio is negatively. Chapter Five is the conclusions and suggestions. According to the analysis, we put forward three suggestions to improve the efficiency of branches with low one. The three suggestions are as follows:the branches with low efficiency should try best to improve the intermediary business so as to create the new profitable fields; the branches with low efficiency should decrease the nonperforming loan ratio and control the credit risk; the branches with low efficiency should rationally expand the scale to take advantage of the scale efficiency.