Research On The Entry Of Foreign Bank And The Countermeasures Of Internal Bank

Since joining WTO, our country has increased opening policy speed in the field of relaxing the banking business region restricting , expanding the foreign financial institution range of RMB business, increasing foreign financial institution in China, building Sino-foreign joint venture banking institution , allowing foreign capital to enter financial market. on December 11, 2006,Our country opened the civil RMB business to the foreign banks. The Chinese government had already confirmed that 9 foreign banks set up the corporation bank in our country. And four of them had started already on April 2, 2007. The foreign banks will grab more Chinese marketplace.More and more foreign banks are entering our country, undisputed, they will bring a lot of development opportunities to the internal banks: The foreign banks will bring about the advanced technology, advanced managing idea and operating way and so on. It is beneficial to improve the internal bank system. And also it is beneficial to let the internal banks go into the globe finical market and improve the competitiveness.But the foreign banks have richer managerial experience, service network and tremendous funds. Therefore, foreign banks will bring challenges to the internal banks. A great quantity of foreign banks floods may increase the risk of the internal banks, or even affect the Chinese banking system.This paper first analyzes the necessity of foreign banks entering our country financial market and the current situation that the foreign banks entered, then analyzes the effect which foreign banks will bring to the internal banks. Then puts forward the corresponding policy suggestions.The first chapter is the summaries of the foreign bank entered. First analyze the necessary of the foreign banks entering our country from the changes of our country finance system and the globalization finance theory. Then make out the six basic form that the foreign banks enter. and then analyses the current condition of foreign banks in our country and the future trend.The second chapter is the effect giving to the internal banks when the foreign banks enter into our country. Analyze the opportunities and the challenges that the foreign banks will bring to the internal banks after comparing the foreign banks and the internal banks.Third chapter is the suggestions given to the internal banks. The suggestions are according to the fierce competition pressure the foreign banks will give to the internal banks. And the suggestions include the short-term strategies and the long-term strategies.At present, there are many researches in this field, but many of them were written many years ago. And there are little paper studies the new condition when the Chinese government totally opens the financial market to the whole world. This paper tries to study deeply in the impact the foreign banks will give to the internal banks in new circumstances, and bring forward feasible policies to the internal banks.The innovations of this article are: using the new institutional economics to analyze the necessary of the foreign banks enter in the Chinese market, and using a case to analyze the real effect that a foreign bank will bring to a internal bank after the foreign bank become a shareholder of the internal bank, and add many diagrams to let the analysis more visualized.