| Accompanied by the rapid growth of China’s economy in recent years, as one of the three major industries in the financial sector, commercial banks also achieved some good results. In asset size aspects, the statistics that China Banking Regulatory Bureau announced in January2013show that:By the end of2012, the total asset size of China’s domestic banking financial institutions reached a record high of131.26trillion Yuan, a year-on-year increasing of17.7%. More worthy of our attention, after just19months from May2011when the total asset size of the domestic banking financial institutions in China exceeded100trillion marks, China’s banking industry once again created a new record. In the profit aspect, the British magazine "Banker" in its latest statistics showed that in2011China’s banking sector profits nearly made up one-third of the global banking industry’s total profits. The China Industrial and Commercial Bank ranked the first place in the global banking earnings list as its＄43.2billion pre-tax profit. China Construction Bank followed CICB as its＄34.8billion pre-tax profit, while ranking third is the Bank of China; its pre-tax profit is26.8billion. But at the same time we see that behind the commercial banks’ high assets scale and high profits, the growth rate of our banking industry’s total assets size rated down0.6%over the same period of previous year’s18.3%in2012which reached the lowest growth level since2007. Our central bank’s vice governor-Pan Gongsheng attended the "China Economic Annual Meeting (2012-2013)" said:China’s social financing remains highly dependent of bank’s indirect financing channels. From the micro perspective, only relying on the expansion of bank assets to support the development of the real economy is unsustainable. Banks’net interest margin income slowdowns and banking earnings growth is also in a very grim situation in2003. This forced us to reflect:Whether our commercial banks’efficiency is on the raise in a true sense? What’s the main factor to affect our countries’commercial banks’combined efficiency (Total Factor Productivity)? What improvements can commercial banks do to improve total factor productivity?Therefore, in the current background, we should calculate the overall efficiency of China’s commercial banks, dissect total factor productivity of China’s commercial banks structure, grasp the efficiency of current commercial bank position and find out the main motivation to affect the total factor productivity. And on this basis, combine with the specific activities of the commercial banks to explore effective ways to improve total factor productivity both in the theoretical and practical ways.This paper estimates and decomposes the total factor productivity of Chinese listed16representative commercial banks. In the analysis process, by using the research framework of pure efficiency progress, scale efficiency progress and technological advances, in combined with empirical and normative analysis, I find out the root cause to effect China’s commercial banks’ TFP. And on the basis of this study, through the relevance analysis of intermediate business development level and banks’total factor productivity development level, I do further validation of the empirical conclusions. At last, according to the empirical results I make relevant recommendations. In this paper, the specific implementation paths are as follows:1. At first, it systematically analyzes the concept of commercial bank efficiency and the development of the commercial bank efficiency evaluation method. It introduces the theoretical basis of the DEA evaluation method chosen in this paper and the introduce of Malmqist function under the DEA evaluation. Meanwhile, it overviews the applicability and application restrictions of the DEA evaluation and Perfect and complements the theoretical framework of commercial banks’ assessment theory.2. Clear the research sample and DEA effective input and output variables, test the selected variables. According to the effective input and output variables, measure the total factor productivity of sixteen commercial banks in China in2005-2011Combined with Malmquist function in DEA method. Analyze the structure of total factor productivity of our commercial banks with the research frame which is based on the improvement of pure efficiency, scale efficiency, technology. Find the root cause of China’s commercial banks’ total factor productivity TFP through the combination of empirical and normative analysis, and explain the realistic meaning3. Through the relevance analysis of the three representative banks’ intermediate business development level and total factor productivity development level and by further validation, I find that through innovative intermediary business to provide clients new services and products can effectively improve the efficiency of commercial banks.The three afore-mentioned steps are closely interlinked, in a consequential order. Using empirical1theory and standard analysis to research on Total Factor Productivity (TFP) in the commercial banks in our country, I would be able to conclude the following four major points.1. TFP is affected by pure efficiency progress, scale efficiency progress and technological advances.While pure efficiency progress is the least relevant one, technological advance is the most important factor affecting TFP. This conclusion can be reflected in the banking system:the improvements in the management or the interest rate spread in commercial banks are not able propel the increase in TFP. Instead, the key to improve TFP lies in the utilization of state-of-the-art technology and facilities in communication in commercial banks. The technological breakthrough would be able to improve the quality of service and products upon the initiation of creative intermediate business.2. Today, the increase in interest rate spread is slowing down. At the same time, however, the administration service charge or commission is escalating, which is supported by the fact that financial products and card services has become the pillar source of profit. The improvement in conventional interest rate spread would not make significant contribution to the increase in TFP in commercial banks as the margin for further improvement in interest rate spread is already small and very competitive. To blindly promote "Increase revenue and profit" is unable to improve the overall efficiency of commercial banks.3. The changes of the scale efficiency behave differently In the statistical sample. Returns to scale are decreasing in the state-owned commercial banks, while returns to scale are increasing in some Joint-stock commercial banks. For the first situation, banks should to reduce the unnecessary outlets, institutions, staffs.4. To research three representative banks in intermediate business among16commercial banks, I found the development of intermediate business is relevant with TFP. Further, compared with state-owned commercial banks, Joint-stock commercial banks have a higher correlation coefficient. With the emerging information technologies, equipment, innovative intermediate business Joint-stock commercial banks provide better financial products for the customs to improve the comprehensive efficiency of banks.Compared with the results of previous studies, this paper has the following characteristics.1. Based on the measurement of total factor productivity on commercial banks, I established analysis model with the improvement of pure efficiency, scale efficiency, technology. In contrast, previous studies focusing on the estimated results of the ranking or measurement of the numerical analysis of the law, little literature estimates results of specific activities of commercial banks to guide empirical estimation results with Bank specific business combination, made additional efficiency improvements in commercial banks.2. Measured by indicators of connotations, from a banking perspective to analyze the impact of the various elements of commercial bank total factor productivity, through empirical reflects the impact of changes in commercial bank total factor productivity determinants:technological progress, the commercial banks by the new information the introduction of technology, equipment, the intermediate business innovation to provide customers with technical progress is fundamental to enhance the efficiency of the bank to provide new services and products.3. Select three representative of the bank, through the correlation analysis between the intermediary service level of development and total factor productivity level of development, and found:improved intermediary service have a significant impact on TFP. Explore enhance the level of intermediate business to improve the technological progress to achieve the path to optimize the overall efficiency of the commercial banks. |
