An Empirical Research For Effects Of The Chinese Commercial Banks’ OFDI On Banks’ Efficiency

With the deepening of economic globalization and the degree of financial liberalization,the relationship between every economic entity in the world is becoming more and more closer, out-ward foreign direct investment has became an important method to participate in the global economic competition and of which the banking sector’s out-ward foreign direct investment has attracted much attention. On one hand, with the reform and openness of our financial sector under the guidance of the government, our commercial banks have tried their best to introduce foreign strategic investors by transferring part of shares. And it has formed an investment boom. On the other hand, In response to the theory of "going out", our commercial banks are trying to accelerate to develop overseas market actively. The scale of out-ward foreign direct investment(OFDI) is becoming larger and OFDI has an important effect on the efficiency of our commercial banks obviously.Based on the domestic and abroad literature review, the paper analyzed current situation, main features and mechanism of action of out-ward foreign direct investment by our commercial banks. And then the paper, using analysis method of DEA, calculated the efficiency of our commercial banks from 2005 to 2014. Based on the results, we found that in recent year the efficiency of our commercial banks has increased apparently and the average level of efficiency increased 12 percent. In order to further explore the relationship between out-ward foreign direct investment and efficiency of our commercial banks, the paper continued to conduct the empirical research using efficiency calculated above as explained variable while using degree of out-ward foreign direct investment as explanatory variable. In the meantime, a Tobit model was built by introducing other explanatory variables like banks’ capital scale, asset quality, banks’ roe and the rate of inflation. At last, we finally found that the out-ward foreign direct investment played a positive role in promoting the efficiency of our commercial banks, and both banks’ capital scale and banks’ roe have positive effects on the banks’ efficiency. The influence of asset quality to banks’ efficiency is negative, in line with expectations, while the rate of inflation has no significant effect on it.In conclusion, based on the theory and empirical research above, the paper put forward some policy suggestions of banks’ OFDI promoting the commercial banks’ efficiency from macro perspectives and micro perspective.