Urban Commercial Banks' Capital Structure On Operating Performance

City commercial bank is an important part of our countries’commercial bank system, it is located in the aim of serving small and medium-sized enterprises and urban or rural residents at the time of the set up, this aim has been implemented during recent years, at the same time, city commercial banks have accumulated a wealth of experience, Differential development and characteristic management gradually recognized by the market, this banks play an irreplaceable role in the process of serving local economy. Compared with large commercial banks, city commercial banks belong to the weak lines in the commercial bank system, they exist a lot of uniqueness, especially the capital structure, have serious historical problems. By the theory of capital structure, the changes about capital structure will affect business performance through internal governance mechanism, the particularity of bank also determines the particularity of its capital structure, so the capital structure’s influence on business performance will be different from ordinary enterprises, so the study between city commercial banks’ capital structure and comprehensive performance is very important, it can make them focus on changing capital to improve the bank’s governance mechanism, on one hand, this makes them clear the directions of changing capital structure, on the other hand, this can lay a solid foundation for the banks, trans-regional development and market development.This paper based on previous method, using ten large city commercial banks in east China an samples, analyzes the correlation between the capital structure and comprehensive performance. There are mainly have four parts in this paper:The first part mainly analysis the capital structure、operating performance and the relationship between them; the second part analysis the current situation of capital structure and business performance through the banks annual report data; The third part first by PCA method to research the banks’ comprehensive performance, and then through simple multiple regression to analysis the relationship between different capital structure index and the comprehensive performance; The fourth part, according to the empirical conclusions and put forward the policy recommendations to optimize the capital structure.The conclusion concluded in this paper is:The core capital and subsidiary capital adequacy ratio、the top five shareholder shareholding were positively related with comprehensive performance; the nature and stake of the first big shareholders were negatively related with comprehensive performance. The possible innovation in the paper is the selection of types of banks-city commercial banks, this is different from the previous study of large commercial banks.