An Empirical Research On Market Structure And Performance Of National Commercial Banking

Finance is in the process of economic development, a critical element in China, a bank-dominated financial system, the banking sector’s development role in economic growth even more important. China’s banking sector has been the protection of national policy, with high barriers to entry and exit, which will form the initial four major state-owned banks dominance. With the reform and opening-up policy of China’s financial liberalization, emerging joint-stock banks and regional banks, the rise and development, as well as foreign banks enter the market reason to break the pattern is gradually formed four major state-owned banks, joint-stock banks, regional banks, as well as foreign banks coexist.Due to historical reasons, the four major state-owned banks, whether the market or the market concentration, are still a clear advantage, the market structure in the city, an oligopolistic structure. In the meantime, the bank’s operating performance, the four major state-owned banks at a disadvantage but, profit margins than new joint-stock banks. Can be seen that the size of the banks can not decide on bank profits. By the end of 2006, China’s financial industry has a fully open, foreign banks will enjoy national treatment. At present more and more foreign banks are aggressively entering China’s financial markets to participate in competition in the banking sector, which means that China’s banking industry will face more severe challenges.After several years of banking reform, although in all Chinese banks have made a good product, such as capital adequacy ratio referred to non-performing assets ratio significantly lower, property rights system and governance structure has made great changes in the breakthrough From the state-owned banks to joint-stock commercial banks will be changed and so on. However, compared to foreign banks, and there are still some gaps, such as the Chinese-funded banks in the quality of services, information technology, Internet banking, management system and so on have yet to be upgraded and improved. China is currently still in the primary market-oriented interest rate reform period, banks in the market is still pricing in a passive position. In the global capital markets gradually mature under the conditions of financing in the near future will be great changes have taken place, these have brought about a further development of the banking industry competition and pressure.China’s banking sector is to respond to these changes and competition? Banking market structure, market behavior and market performance, how will the change? These questions are no doubt China’s banking industry urgently need to resolve.