Study On The International Business Of China's State-owned Commercial Banks

Internationalization of commercial bank is an inevitable product of the world's economic development to a certain extent. It is also a result of profit maximization of the commercial bank. In the situation of economic and financial swept the world, almost all the countries have different levels of participation to the international process. After China's accession to WTO, China's financial services industry has gradually achieved a comprehensive opening to foreign banks which have a lot of strengths and advanced management experience. Domestic market will become more competitive. At the same time, the living space of our Chinese banks will be smaller and smaller. In this situation, we can not always be passive. On the contrary, we should take initiative measures. Chinese commercial banks have to go out to the vast international market and take some measures to expand space, enhance international competitiveness and spread risks. Meanwhile, the profit of state-owned commercial banks increased substantially, the non-performing loan ratio continued to decline, provision coverage increased substantially and management ability enhanced a lot in recent years. Objectively, our state-owned commercial banks have the strength of internationalization. In this situation, Chinese state-owned commercial banks to study international business have strong theoretical and practical significance.Currently, a lot of foreign academic research is about bank internationalization and focused on motivation research. Although domestic scholars have realized the importance of international banks, but the existing research is still relatively small. In view of the state-owned commercial banks in China's financial system in an important position, the paper chooses the five state-owned commercial banks as a representative for the study.The first chapter simply introduces the international literature on bank internationalization, focusing primarily on the motivation of internationalization, and introduces the contents of this study and the overall framework. ChapterⅡdescribes the theory about motivation of internationalization as the theoretical basis for the following, including Aliber's theory of comparative advantage, Rugman's internalization theory and Dunning's international production eclectic theory. Then illustrate the significance of the business internationalization about state-owned commercial banks from aspects of the outside world, multinational enterprises, diversifying risk and enhancing overall competitiveness. In the third chapter, take Citigroup and HSBC as examples, through a review of its internationalization history, summed up the successful experience of its internationalization, trying to have implications for state-owned banks. In the chapterⅣ, a large amount of data on China's five state-owned bank's international status was introduced, and then concluded some problems in the process of internationalization, including low proportion of overseas business and the uneven distribution, single types of international business and lack of innovative capacity, out of touch about state-owned banks and enterprises in the aspect of international operations.Then the paper explains the reasons for these problems from the business model, talent, not familiar with international practice and competition in the domestic market. As China's economic grow rapidly, it also pointed out opportunities of state-owned banks. In the last chapter, the paper gives advices from the solid foundation, choose the right path and create an environment that is good for the cooperation of state-owned banks and enterprises. In the aspect of consolidating foundation, banks can study the host country laws and regulations about foreign banks, develop international financial professionals and improve the financial innovation. In the aspect of choosing the appropriate path, on the basis of comparison of the new investment and transnational mergers and acquisitions, the paper thinks that the new investment and cross-border mergers and acquisitions can be combined in the process of internationalization. In the aspect of creating a environment that is benefit both state-owned banks and enterprises, banks should meet the financial needs of Chinese enterprises, follow Chinese enterprises and build a bank and group.