Competitiveness Comparison Between Chinese And American Large Commercial Banks

With the smooth progress of the joint-stock reform of state-owned commercial banks, China proposed the "going out" strategy of banking industry. The5commercial banks, namely, ICBC, CCB, BOC, ABC and BOCM gradually accelerate their internationalization process. The U.S. Subprime Crisis had raised a global financial tsunami; many world-class commercial banks suffered heavy losses and had to narrow the scope of business. In contrast, China’s banking sector had kept a good management and realized an unprecedented achievement. However, the young Chinese commercial banks have just entered the international market. So far, the argument of its competitiveness is inconclusive. To participate in the international competition, China’s large commercial banks still need more exploration and growth.This paper sought to use Michael Porter’s Diamond Model to attain a better understanding of the development of China’s large commercial banks and the factors affecting their international competitiveness, so as to help improve their competitiveness in a more targeted way. The author selected14variables referring to the factors that impact industrial competitiveness, including Factor Conditions, Demand Conditions, Related and Supporting Industries, Firm Strategy, Structure and Rivalry, and Government. Then the paper also summarized four categories of competitiveness factors by using the method of Factor Analysis, upon which constructing the Competitiveness Index. Based on these, the paper compared and analyzed the international competitiveness and the competitiveness level of both Chinese and American main commercial banks in macro, meso, micro and safety four aspects. The results showed that, on one hand, relying on the increasing strength of related and supporting industries and the steady expansion of their own size, China’s large commercial banks have good prospects in the international arena; on the other hand, as the development environment is not mature enough, as well as the lack of advanced production factors and the defective of security, there is still a certain gap between Chinese and American large commercial banks.