Study On The Characteristics Of The Board Of Directors,Foreign Equity Participation And Bank Operating Performance

The board of directors is the core of corporate governance and an important internal governance mechanism.As a bridge connecting shareholders and managers,the board of directors has an extremely important position in bank governance.A large number of scholars at home and abroad have confirmed through theoretical research and empirical analysis that the governance of the board of directors of commercial banks is closely related to their operating performance.An efficient board of directors can not only effectively supervise and restrict management,but also protect shareholders from harm,thereby improving the company's operating performance.Existing scholars and experts have found through research that the efficiency of board governance is closely related to board characteristics,such as board size,proportion of independent directors,proportion of foreign directors,frequency of board meetings,and number of professional committees.Banking reform is the top priority of China's financial reform and an inevitable requirement for the development of national economic needs.Since China joined the World Trade Organization in 2001,China's banking industry has undergone tremendous changes.State-owned banks divest non-performing assets,complete shareholding system reforms,and successively go public.In 2006,China fully opened up its banking industry to foreign countries,and foreign banks also stepped up their formation in the Chinese market.In August 2018,the China Banking and Insurance Regulatory Commission issued the“Decision of the China Banking and Insurance Regulatory Commission on the Abolition and Amendment of Certain Regulations(Draft for Comment)”.The equity investment ratio rules continue to promote the facilitation of foreign investment.Although it is imperative to relax the restrictions on foreign investment holdings,some domestic experts and scholars have worries about the restrictions on foreign investment holdings.They feel that the liberalization of foreign investment holdings affects the development of China's banking industry,and even “mainly anti-guests”.The dominant force in China's banking industry endangers China's financial security.The impact of foreign investment in China's banking industry on the performance of China's commercial banks needs further analysis and demonstration.By sorting out and summarizing relevant research,this article finds that the characteristics of a commercial bank's board of directors are closely related to its operating performance.Foreign equity participation also has a profound impact on the bank'soperating performance.At the same time,it is also found that foreign equity participation has a moderating effect on the relationship between board characteristics and bank operating performance.However,few experts and scholars at home and abroad have done such research on the relationship between board characteristics,foreign equity participation and company performance.This article incorporates the three into a unified research system,which discusses the characteristics of the board of directors and the impact of foreign equity participation on the operating performance of commercial banks.It also analyzes the moderating role of foreign equity participation in the relationship between board characteristics and bank operating performance.First of all,this article introduces the research background and significance of the article in the introduction,and then reads the relevant research done by experts and scholars at home and abroad from the perspectives of board characteristics and bank operating performance,foreign equity participation and bank operating performance.Literature to find valuable but not fully explored research areas,this is the research value and innovation of this article.Then introduced the research ideas and research methods of this article,and pointed out the innovation and shortcomings of this article.Chapter 2 first defines the concept of board characteristics,then introduces the way in which foreign capital shares China's commercial banks,then introduces the measurement methods of China's commercial banks' performance,and then in turn explores the impact of board characteristics on domestic commercial banks.The impact of foreign equity participation on domestic commercial banks,while making reasonable assumptions.Chapter 3 describes the current status of the characteristics of the board of directors of domestic commercial banks,the current status of foreign equity participation,and the current status of bank operating performance in the form of tables and charts.From the data in the icon,it can be seen that the number of sample commercial bank boards has not changed significantly The trend is that the proportion of independent directors,the number of professional committees and the number of board meetings are increasing,and the proportion of foreign directors is shrinking.Due to the slow process of deregulation in China,the restrictions on the proportion of foreign shares held by Chinese banks were lifted in 2018.Therefore,the proportion of foreign shares in most domestic banks is not high,and the difference in foreign shares among banks is large.From the perspective of the performance of domestic commercial banks,it may be due to the fierce competition and supervision between China 's commercial banks and traditional finance and Internet finance.For reasons such as gradual improvement,its operating performance is declining year by year.The fourth chapter builds four multiple regression models based on the hypothesis proposed in thesecond chapter,selects 396 data of 36 commercial banks in China from 2008 to 2018 as the research object,and does the correlation analysis,multiple regression analysis,and robustness in order.Test,through empirical analysis to verify whether the hypothesis proposed above is true.The empirical results show that: the more professional committees under the board of directors,the better the performance of China's commercial banks,and the relationship between the two has passed the significance test.The higher the percentage of shares held by overseas strategic investors,the better the bank's operating performance,and the relationship between the two has also passed the significance test.Asset size has a significant negative effect on China's bank performance.Finally,according to the empirical results,the corresponding countermeasures and suggestions are proposed.China 's commercial banks should maintain an appropriate board size,arrange board meetings reasonably,at the same time improve the independent director system,appropriately increase the proportion of independent directors,actively introduce overseas strategic investors,and give full play to their Active role,increase the speed of commercial banks to learn and innovate,strengthen financial supervision and international exchanges and cooperation.