Comparative Study Of Core Competitiveness Between Chinese Banks And Foreign Banks

As foreign banks enter China and enjoy ‘national treatment’, the competition in banking industry hasbecome more and more fierce. The competition level from clients and market level rises to banking equity andcontrol level. Foreign banks with considerable strength and mature management have a positive effect onChina’s commercial banks in terms of technology, products and services. Faced with the fierce competition,Chinese banks need to strengthen its core competitiveness, which is significant for its survival anddevelopment as well as China’s financial and economic security.Based on the general theory of core competitiveness and the particularity of commercial banks, acommercial bank’ core competitiveness evaluation index system is built, following the scientific,comprehensive, operability and comparability principle.27Chinese banks and foreign banks are selected. Thispaper explores the element of commercial bank’s core competitiveness by factor analysis. The differencesbetween Chinese banks and foreign banks are identified and some measures to enhance the corecompetitiveness of Chinese banks are also put forward.The results show that the core competitiveness of foreign banks is better than Chinese banks in general,Chinese banks need to enhance its security and risk management ability, financial innovation and corporategovernance but ahead of foreign banks in the level of value creation and development ability from theperspective of the element.