Performance Evaluation Of Commercial Bank

As an important part of financial industry in China, Commercial bank plays an important role as financial intermediation in financial markets. Its operational efficiency will affect several parts including the allocation of resources, sustainable development, and capacity of the entire financial system.Furthermore,it can directly impact on our national economy healthy and sustainable development. Therefore, the improvement of the bank’s efficiency is a key part of preventing banks far from financial risks, promoting the bank’s sustainable development, which is the core of deepens the financial reform in China. Scientific and reasonable performance evaluation plays a vital role in the survival and development of the commercial banks. There are more and more new methods to evaluate banks’performance evalution based on financial indicators, adding EVA, and10P theory and Balanced Scorecard that is taking into account for both short-term and long-term goals.This paper will use both short-term and long-term goals of the Balance Scorecard to establish a index system and using analytic hierarchy process to determine the index weaight.Then taking the two organic combination into accounting as qualitative indicators. This paper has following sections.First of all, introduction part,it leads reader to know the importance and urgency of performance evaluation by studying the background and significance. It is not only shows the result which is studied by domestic and foreign scholars, but also describes the research method and innowation by the research status. Adding economic value into the balanced scorecard in this paper could fully reflect the benefits and risks in the bank. The performance evaluation system which is constructed by the Balanced Scorecard method, is taking into account financial targets and non-financial indicators, taking into account the bank’s long-term and short-term interests, taking into account the internal economic and external customers to maintain. The analytic hierarchy process to determine the index weight. It is taking into account the qualitative and quantitative indicators of the weight to determine possible indicators. In this paper, divided into the following sections. First introduction, leads reader to know the importance and urgency of the performance evaluation by studying the background and significance. It describes the ideas and research.It is not only shows the result which is studied by domestic and foreign scholars, but also describes these research methods and innovations by the research status. The second part is quo and inadequate of China’s existing performance evaluation system. By contrasting different rating agencies used different evaluation system, the existing indicators in the performance evaluation more focused on short-term financial indicators, the lack of pilot indicators, cannot effectively implement and reflect the bank’s overall business strategy and long-term business development goals, divorced from the performance appraisal system and the banking strategy implementation. The third part is Commercial bank performance evaluation system reconstruction, according to the following science, comprehensiveness, consistency, independence, the principle of availability. According to the Balanced Scorecard evaluation system reconstruction and Analytic Hierarchy Process to determine the index weight. The fourth part is empirical analysis which is based on performance evaluation system of the Agricultural Bank of China Henan Branch, combined with China’s agriculture Bank Henan Branch.An empirical analysis is based on the index system, based on the empirical analysis of banking and financial perspective, customer perspective, internal business levels, learning growth perspective to analyze and make recommendations. The fifth part is implementation of the evaluation system which is should be supporting measures, an implementation of the program without support for the bank executives, bank external assistance, and supporting incentive mechanism is unable to advance.