An Empirical Analysis Of The Correlation Between Ownership Structure And Performance Of Listed Commercial Banks In China

Banks occupy a dominant place in China and play a significant role in financial asset allocation in China.Along with the joint-stock reform of banks and deepening of financial reform,the relationship between banks' ownership structure and performance are getting more and more attention of scholars both at home and abroad in the process of a serial of policies and events,such as introducing strategic investors,initial public offerings and gradually liberalizing bank entry of private capital.Bank ownership structure is one of the most important parts of bank internal governance structure.Although banking industry of China has experienced a series of reform,ownership structure imbalance,high equity concentration still exist.The administrative culture maintains the stabilization and the business objectives are not based on maximizing banks' profit.Thus,the study of correlation between the ownership structure and the performance helps us to understand the last round of bank reform and the new proposed mixed ownership reform.In this context,this paper intends to examine the correlation between the listed banks' ownership structure and performance in China after the reform of non-tradable shares.First of all,based on the theories of bank ownership governance,this paper summarized the current domestic and foreign research on relevant discussion of correlation between performance of the bank and its ownership structure.Secondly,given the correlation reflected differently in different country,the paper focuses on the correlation of listed commercial banks in China.Thirdly,based on the analysis of the present situation of ownership structure and operating performance of listed banks in China from the end of 2007 to 2015,the paper analyzes the ownership structure from three dimensions: attributes of ownership,ownership concentration and outside blockholders.Then,the paper puts forward the hypothesis on relationship between its performance and ownership structure.Through descriptive statistics,correlation test and multiple regression analysis,the paper clarifies the correlation between theownership structure and performance of listed banks in China and validates the relevant assumptions.The results show that there is no significant correlation between the nature of its shareholders and its performance in China's listed banks.The ownership concentration of listed banks in China is negatively correlated with its performance.The balance of equity can significantly improve the performance of listed banks.Finally,based on the conclusion of empirical analysis,the paper puts forward relevant countermeasures and suggestions on how to optimize the ownership structure of China's banks and further enhance ownership governance.On the one hand,in the promotion of equity diversification and steadily promoting mixed ownership of bank,we need to achieve effective management under the certain ownership structure.On the other hand,to promote the effective management of the bank ownership,external governance mechanisms,such as manager market,capital market construction and arrangement also have a positive effect.