The Research On The Structure Of Chinese Banking Industry

By the end of 2006, China has already smoothly finished the five years'transition-period after entering the WTO and opened all the financial industry according to promise. Our banking industry is on a crucial reforming. At present, it still has some problems, such as the market elements'concentrating in a few oligarchies, the whole market's monopolization coexisted with partial over-competition, lacking of marketable entering & exiting barriers and unreasonable competitors'structure. These problems will seriously influence the foundation and the efficiency of our banking industrial organization, as well as the full the overall effects'exertion of the reform.This article does positive description and analysis on the relevant factors affected on the market structure of our banking industry by using the method of theoretical analysis and reality analysis according to the industrial organization theory. Profiting on mathematical analysis, it selects CRn and HHI, the two easy using and representative indexes, to measure the industrial concentration ratio of our banking industry and analyses the current situation and development tendency of our banking industry's market structure. This article has the main points of view below. First, the market structure of our banking industry is transforming from monopolization to competition. Enhancing competition cannot only pursue concentration degree's decline, but also need to consider the demand of competitive power in the global competition. Second, Because of our low product variation degree, it is easy to get superiority in the competition by products innovation. Third, the lack of consummate market withdrawal mechanism is bed for the establishment of effective competition structure in our banking industry. Fourth, in the future, our banking industry will change from the competitor's diversification to the tendency of M&A. The factors determine the market structure together by mutually permeating and affecting.In the face of broader market environment, more multiform participant as well as more complicated competition after the opening, we urgently desiderate to enhance the competitive power by adjusting the market structure and to obtain the base of Competitive power promotion. On the base of analysis of the market structure of our banking industry, this article proposes on supervising and structure transformation that we need to speed the development of small banks, optimize the concentration degree, relax control and strengthen liquidity management, etc, which are helpful to improve the market structure and enhance the competitive power of our banking industry.