The Research Of Chinese Commercial Banks’ Efficiency And Influence Factors Base On The Perspective Of Risk

Risk management and efficiency improvement are not only the important problems which commercial banks facing in the operation and management, but also the major theme of the central banks who maintain financial stability and promote economic development in the world. But the existing research of the efficiency of commercial banks implicitly assume that most banks are facing the same degree of risk. Many researchers didn’t give enough attention to the risk of commercial banks. The research of the efficiency and risk of commercial banks are not fully developed, neither in the study of profit efficiency nor in the study of cost efficiency. It will be large error in the research of the efficiency of commercial banks without considering the risk factor.This paper deeply researches the efficiency of chinese commercial banks base on the perspective of risk. First, this paper estimates the Z-value of commercial banks in China, and analyzes the other indicators of risk. Found that the risk of bankruptcy of the commercial bank in China has a trend of decline. Secondly, this paper calculated the efficiency of Chinese commercial banks using the stochastic frontier approach in considering the risk factors or not considering. Then we compares and analyzes the efficiency which calculated in the two situations. The results show that: it is likely to underestimate the commercial banks’ profit efficiency, and significantly influences the ranking of the profit efficiency of the commercial banks, without considering the risk factor. Finally, this paper analyzes the important factors of commercial banks’ efficiency from the four aspects which are loan to deposit ratio, the asset scale,the financial crisis and the macroscopic economic environment. Commercial banks’ loan to deposit ratio is positively related with efficiency. Assets scale is also positively related with the efficiency of commercial banks. Larger asset scale of commercial banks would have good efficiency. The financial crisis has a negative effect on the efficiency of commerical banks. The growth rate of M2 has a significant positive effect on the efficiency of commercial banks.According to the above conclusions, this paper puts forward the following suggestions: Chinese commercial banks should continuously improve its risk management mechanism to further improve the identification, assessment, control of risk and decision-making system in business, Chinese commercial banks should improve the efficiency of banks’ risk management, promote the reform of the system of commercial banks, and gradually perfect the corporate governance structure. Chinese commercial banks should transfer the traditional business model and develop the financial innovation.