The Impact Of The Entering Of Foreign Banks On The Efficiency Of Chinese Commercial Banks

China kept increasing the control of the financial market since the reform andopening up,which makes the development of financial market rapidly. At the sametime, foreign banks continue to enter the market of China’s banking industry. Whenour financial market become enricher,foreign banks which have unique businessphilosophy and financial products have had a profound impact to the China’scommercial bank efficiency.Firstly this paper analyses the background of the foreign banks’ entry of China’sbank market,and summarizes the preview theories from home and abroad as well aspros and cons;then introduces the basic concepts of the process of the entry offoreign banks, distributions and so on. After that, this paper introduce both thepositive influence and negative influence of the foreign Banks’ entry to our country’scommercial banking efficiency effect on theory analysis. This paper focuses on theempirical analysis of the entry of foreign banks.the author has used the popularDEA method through thirty banks in our country’s data on2003--2010to measurethe impact of the foreign banks’s entry to the host country banks’ efficiency, thenregression and analysis the measurement results.The empirical results show that theentry of foreign banks to our country’s commercial banks have a positive role inpromoting the efficiency, and the promoting effect of the joint-stock banks arestronger than the promoting function of state-owned banks. At the end, the paperputs forward the corresponding policy suggestions on the government from attractting more foreign banks, the principle of prudence and the communications withforeign bank.Facing the challenges of foreign banks, Chinese banks only constantinnovation and learning, and innovation of corporate governance structure,strengthen the risk control of financial products. So that Chinese commercial banks can establish themselves in the competition with foreign banks and progressceaselessly.