Correlation Studies On Financial Holding Background And Operating Efficiencies Of Trust Companies

As one of the four pillars of the China’s new financial system, the trust industry isnow studied by more and more domestic scholars, especially the correspondingdevelopment model and positioning within the financial industry of trust company hasbeen a hot topic. In recent years, more and more trust company are held by differentfinancial institutions and groups, and the controversial topics gradually highlight, that isunder the mode of financial holding company, Is it feasible for bank or financial groupto hold the trust company, does the good synergistic effect work, which no unifiedconclusion has formed yet in the domestic industry.This paper selected the normal operating trust company from2009to2011assamples, analyzed their operational efficiencies, and then grouped and analyzed the trustcompanies held by financial institutions, also compared their operating efficiencies andfinally discuss the factors affecting their levels of efficiencies. This paper used variousmathematical analysis methods, such as, descriptive statistics, nonparametric test, dataenvelopment analysis (DEA) and limited dependent variable model (Tobit Regression)to do data processing and analysis in empirical test. The empirical results showed that,in financial holding trust companies, the performances of trust companies held by purefinancial companies are better than trust companies which held by other organizations,however, the performances of mixed financial holding trust companies are inferior,synergistic effects between financial institutions did not play well; moreover, theoperating efficiency values of mixed financial holding trust companies are lower thanthat of pure financial holding trust companies. This paper used Tobit regression toanalyze factors affecting operating efficiencies of trust companies held by financialinstitutions. The paper concluded that employee size, percentage of actively managedtrust business, and the ratio of collected trust assets amount and single trust assets amount are significantly positively correlated with trust company operating efficiency.In the end, the paper combined theoretical analysis and empirical results to explain thedifferent operating efficiencies of two different groups of trust companies held byfinancial institutions, and proposed the corresponding policy suggestions of futuredevelopment pattern and business development direction for China’s trust companies.