Study On The Correlation Between China’s Joint-stock Comemercial Banks Capital Ratios And Performance

Capital of commercial banks is to ensure that the bank opened and normal operation of thefoundation, it is to maintain public confidence in the basic premise, but also necessary to ensureabsorb various banks in the event of a risk of loss.The capital adequacy ratio is the regulatoryauthority to require commercial banks must maintain a minimum capital ratio is one of the mostimportant indicators to measure its operating stability and risk resilience.Subprime mortgage crisis, gradually increase the bank’s capital in order to improve thestability and performance of the bank, and has become an international consensus.China since2004,it has successively promulgated the Management Measures on the capital adequacy ratio ofcommercial banks, commercial banks capital adequacy supervision and inspection guidelines"series of regulatory documents to carry out the provisions of the capital of banks,As can be seen,China has the transition to the capital regulatory core capital adequacy ratio was constantly adapt tochanges in the regulatory environment at home and abroad and meet Basel II requirements.As joint-stock commercial banks, relying on the expansion of the scale of assets to seekdevelopment, has been unable to meet today’s competitive environment, various joint-stockcommercial banks have to look for greater profit margins, in order to consolidate their position, andhave plenty of capital is one ofthe key.How to conduct effective supervision of capital adequacyratio, the commercial banks to meet the minimum capital requirement, the number of capital neededto maintain normal operations, but also to improve their level of performance at the lowest cost tomaximize profits of China’s financial industrythe development of very important significance.Based on10joint-stock commercial banks, for example, the analysis of the overall capitaladequacy ratio of the current situation and existing problems, descriptive statistics and econometricmodels, the capital adequacy ratio and on behalf of the bank financial performance indicators docorrelation analysis andregression analysis, concluded that, if the capital adequacy ratio ofcommercial banks to meet regulatory requirements even higher, can improve the bank’s profitability to some extent, enhance the liquidity of the commercial banks’ assets, reducing the bank’snon-performing loan ratio, so this articleproposes to strengthen the supervision of the capitaladequacy ratio and suggestions and countermeasures to improve the performance of banks on thebasis of the relationship between the capital adequacy ratio of the banks’ performance in this draw.