The Analysis Of The Sustainable Growth Of Chinese And Foreign Commercial Banks

Commercial banks are not only an important component of China’s financialindustry, but also are also the major force to maintain and promote the smoothoperation of China’s economy. In the era of increasingly serious resource constraint,the sustainable growth of commercial banking is a hot issue in the academic field.Since the outbreak of the international financial crisis in Jul2008, people began topay more attention to how to make the commercial banks on a sustainable growthpath, which allows the commercial banks to ensure a high growth business andachieve the enterprise value in the condition of established financial goals in thisprocess.By using the normative and empirical analysis, this paper built a theoreticalframework for analyzing the sustainable growth of the commercial banks after the keyconcepts being clarified. In empirical part, the samples are selected as16China’s and32foreign listed commercial banks. Through the investigation of the status quo andtheoretical analysis, this paper researches the status of sustainable growth and actualgrowth of them in the last five years (2006-2010) by descriptive statistic, Wilcoxonsigned rank test and multiple linear regression analysis, etc. Then we compareChinese commercial banks with the foreign commercial banks by the actual growthrare, sustainable growth rate, ROE, the relativity of growth speed and value goal, theimpact of the size and age of the commercial banks on the value goal. It also pointedout the characteristics of them and tested the related hypothesis, and analyzed whyresult in the difference. Main research findings are as follows:The actual growth rate of China’s listed commercial banks is higher than thesustainable growth rate in the same period, which means they achieved “high growthrate” rather than sustainable growth. The foreign commercial banks did not achieve“high growth rate”, but they achieved sustainable growth basically.The change of enterprise value of Chinese commercial banks is not significantly related to the change of growth speed. But the change of enterprise value of foreigncommercial banks is significantly related to the change of growth speed. Besidesgrowth speed, the impact of the size and age of commercial banks on the value goal isalso different.Finally, it proposed deepening the corporate governance of China’s commercialbanks and balancing the relationship between dividend payments and retainedearnings according to the results of empirical and comparative analysis.