The Building Of Financial Performance Indicator System For Joint-stock Commercial Banks

As special corporations, banks, which offer considerable support to national economy, contribute significantly to the development of social economy. With the rapid growth of financial industry, banks attract more and more attention from every corner of the world in recent years. Among these companies, joint-stock commercial banks commence their advance towards international way. An obvious progress on corporate management and risk control has emerged. Quality and structure of assets have been optimized. Meanwhile, the ability to resist and compensate risk has been improved. Therefore, joint-stock commercial banks have gradually occupied key position in bank system. However, actual situation of the banks are not widely acknowledged, especially on financial performance. Few relative researches have been conducted on financial performance of the banks. This paper locates its research objective on joint-stock commercial bank, focuses on building financial performance indicator, and carries out financial performance analysis on a certain bank to judge and evaluate its position in competition.The article is composed of five parts: In chapter one, the background, significance, content and structure of the research are introduced. In chapter two, relative theories on bank performance evaluation, including theories on performance management, main content and methods of bank performance evaluation system, are introduced. The foundation of building financial performance indicator system for joint-stock commercial banks is laid down by the relative theories above. In chapter three, financial performance indicator system for research objects are built with corporate financial analysis system and financial analysis methods in our country. The principle of selecting indicators, the selection of indicators and the use of financial analysis methods are involved. The selection of indicators covers liquidity indicators, asset risk indicators, liabilities and solvency indicators, profitability indicators, assets operating indicators, growth indicators and capital adequacy indicators. The indicator system covers all major aspects on financial statements. Main financial analysis methods adopted are trend analysis, rate analysis and factor analysis. In chapter four, empirical analysis on China Merchants Bank is conducted after building financial performance indicator system for joint-stock commercial banks. Financial data from 2007 to 2010 and panel data on seven banks in 2009 are selected and compared. Accordingly, problems for the bank and development recommendations are concluded. In chapter five, the author summarizes the financial performance indicator system. By enormous reading on relative theories and reference on corporate financial performance indicator system, the system for banks is constructed and evaluation from seven aspects is performed. Trends and factors are found by empirical analysis on data of China Merchants Bank, which benefits the improvement of financial performance. The defects are found through the comparison of banks from the same industry. Reasons for the defects emerged and financial performance can be accordingly improved.