Efficiency Study On Commercial Banks In China Based On Data Envelopment Analysis

In recent years, as a pillar industry of the financial industry, there isno doubt that the rapid development of the banking industry is the key to promotingthe development of the financial sector. As to the commercial banks, efficiency is thecore of the management of a bank, the study of bank efficiency can reflect the overallbusiness conditions, the use of resource conditions and the competitive ability of thebank. And it also can help the decision-makers of the bank to formulate and improvethe strategies of bank efficiency, realize the optimal allocation of bank resources,prevent relevant risks. And then it can better guide the reform and development ofChina’s banking industry, promote the healthy development of China’s financialindustry. Therefore, the analysis of business strategies and operating performance ofChinese banks has a very important practical significance.In this paper, the writer applied the data envelopment analysis method to analysisthe operational efficiency of China’s commercial Banks. First, it understands thebackground and significance of the study of the efficiency of China’s commercialbanks, and the study has defined the concept. Then using the2000-2010data, construct ascientific evaluation index system, select the DEA model as the research means ofefficiency of Commercial Bank of our country to measure. Ultimately select thenetwork DEA model as a research tool, the savings deposit as intermediate variablesto analyze dynamic efficiency of commercial banks. And combined with the analytichierarchy, the weight of each index range re-set. Which overcomes the main dilemmais whether to treat deposits as an input or an output by using of the traditional DEAmethod to measure banks’ efficiency. And the weights are constrained, it may reflectthe focus of policymakers. Combination of qualitative and quantitative analysis,verify the theoretical research and empirical analysis. This paper analyses on theresults of the empirical analysis of the efficiency levels and trends of China’scommercial banks. And thus it evaluates the state of the banks. Finally, the contents ofthe research have made the need for summary, and then topics of research anddevelopment directions are suggested.