Institutional Distance,Openness Degree Of Host Market And Internationalization Degree Of Chinese Banks

With the rapid development of China's economic strength,and the implementation of the“One Belt and One Road”policy and the globalization of international financial services,more and more Chinese banks have begun to“ Go to the World ”.Thus has opened up a new pattern of bank internationalization.However,the new era of opening up to the outside world makes Chinese banks inevitably face new risks and challenges when they enter the host countries.How to better deal with risks and challenges from the host country's economic,legal,and cultural aspects,and seize the opportunities,has became a difficult problem on the face of the Chinese-funded transnational banks.Some scholars have pointed out that the institutional distance between the host country and the home country can significantly affect the internationalization of transnational corporations.Different from previous researches on internationalization of banks,such as foreign investment,entry mode and cross-border M&A performance,the institutional theory sets out from the national level.It has analyzed the differences in the institutional environment which transnational banks must confront.The choice of understanding the bank's internationalization strategy has provided a new idea for the bank's international research.In view of this,this article starts from the institutional theory,defines the institutional distance between the host country and the mother country,and takes this as a perspective to study the influence of institutional distance on the degree of internationalization of Chinese banks.First of all,this article summarizes domestic and foreign research literature on institutional distance and bank internationalization,and summarizes its theoretical basis,and proposes that this paper studies the degree of bank internationalization from the distance of legal system,the distance of economic system and the distance of cultural system,and sorts out theoretical research framework.Secondly,this paper uses the Global Governance Index,Economic Freedom Index,and Hofstede Cultural Index to measure the legal,economic,and cultural institutional distances of this paper.After analyzing and processing the data,the Panel Panel VAR model is applied to the dynamic panel data of this article.Then,it has used of root test,estimation and variance decomposition analysis,and used of hierarchical regression analysis to analyze the regulatory role of the openness of the host market,and used of post hoc analysis of the stability of the panel data to achieve the proof of the research hypothesis proposed in this paper,Then we draw the conclusions of this paper.Finally,based on the research conclusions of this paper,we put forward the corresponding management enlightenment and countermeasures for the international operation of Chinese banks,and pointed out the research limitations of this paper and future research directions on this topic.In accordance with the research logic of this article,this study mainly obtained the following conclusions: First,the distance between the legal system of the host country and the home country,the distance of the cultural system,and the degree of internationalization of Chinese-funded banks are significantly negatively correlated.That is,the greater the distance,the banks are less willing to establish branches in host countries;the economic system is significantly positively related to the degree of internationalization of Chinese banks,that is,the greater the distance,the more willing Chinese banks are to set up branches in host countries.Second,whether the economy,the law,or the cultural system distance lags behind the degree of internationalization of Chinese-funded banks,and the lag coefficient is consistent with the research results of this paper as a whole,and the distance of the cultural system is for overseas branches of Chinese-funded banks.The number of institutions explained the strongest,followed by the distance of the legal system,and finally the distance of the cultural system.Third,the openness of the host country's market can significantly adjust the institutional distance on the influence of the degree of internationalization of Chinese banks,and can also strengthen the influence of legal,economic,and cultural institutional distances on the degree of bank internationalization.This innovative research introduces the institutional distance into the research themes of bank internationalization,and based on this perspective,it analyzes the mechanism of the influence on the degree of internationalization of Chinese banks from the perspective of legal system distance,economic institutional distance and cultural institutional distance.This study provides a very good theoretical perspective for the theme of internationalization of banks,and it also participates in the regulatory role of the openness of the host country market.It further explores the mechanism of the theory model in this paper and expands the research thinking of institutional theory,then provid strategies and recommendations for bank's international operations.