China’s Joint-stock Commercial Bank IPO Pricing Problems

Accelerating the reform of China’s financial industry, a growing number ofjoint-stock commercial banks will be listed on the way to improve the corecompetitiveness and to improve the corporate governance structure. The listing willinevitably relates to how the IPO pricing. In this paper, a combination of theoreticalanalysis and empirical research, objective description of China’s commercial banksshare IPO pricing problem, and proposed policy recommendations to improve theIPO pricing later listed joint-stock commercial banks play a reference for the role.Firstly, through a brief introduction of the discounted cash flow model, theCapital Asset Pricing Model, comparable company model the stock IPO pricingtheory and its applicability analysis to study the relationship between the variousfactors affecting the IPO pricing.Second, the combination of the bank’s corporate characteristics, from the inside,two external factors qualitative analysis of the main factors affect the pricing of bankshares IPO, initially established factors affect IPO pricing index system. On this basis,the12commercial banks in the market since1999, IPO pricing empirical research tofind out the important indicators of bank shares IPO pricing regression model toestablish a commercial bank share IPO pricing. In the process of doing empiricalresearch, also found that:(1) the listed banks operating fundamentals have becomeimportant factors that affect the IPO pricing;(2) macroeconomic growth and IPOpricing are negatively correlated;(3) secondary market conditions out of touch withthe IPO pricing, a secondary market, lack of contact;(4) IPO offering mechanismoperating inefficiencies, run market offering mechanism conditions are not perfect.Finally, in response to these phenomena, from commercial banks, its ownbusiness development, the environment of the national economic operation,ownership structure and foreign stake in four policy recommendations to improve bank shares IPO pricing.