Study On Operating Efficiency Measurement And Path Optimizition Of Securities Companies In China

Securities companies in China have gone through nearly30years of development since the first securities company in China was formally established in1987. And securities market in China has developed fast in the recent20years since Shanghai Stock Exchange was established in1990. Securities companies as the market main body play an important role in the development of securities market. In the process of integrating with the world economy after reform and opening-up, the development of the securities market received all aspects of the international impact. During the development of China’s securities companies, it experienced in domestic and international big changes and impact but also had a considerable scale. The development and the operating conditions of the securities companies affect the stability of the financial market. Consequently, the operating condition and the sustainable development condition of the securities companies in China as well as the method that can be used to evaluate it has been the concern of academics. Over the years, the operating performance of banking, insurance and other financial units was measured with efficiency evaluation method by some academics. This dissertation aiming to evaluate the operating conditions of securities companies in China based on the study.The research scope of this study based on the securities companies that set up and carried out the business in Mainland China between2008and2011. This study selected a representative sample of30securities companies as samples. Total assets, employee compensation, operating expenses minus employee compensation and sales tax and extra charges were selected as input indicators. Meanwhile operating revenue was selected as output indicators. Data envelopment analysis was used to measure and analysis efficiency. Improvement measures and suggestions will be given to inefficient companies after analysis. There are six parts in this dissertation:Firstly,this paper starts with introduction part. This part focuses on the research background and significance. This paper points out the importance of efficiency studies by analyzing current capital market environment and ability of competition and sustainable development of finance units. This part is a basis for the analysis in this study.Next,the relevant theories and concepts are defined in this part. This part mainly focuses on introducing the concept, application steps and basic model for DEA. Finally, this study determines analysis of efficiency of securities firms, which based on input oriented BCC model and the Malmquist total factor productivity change index.Analysis of operating status of the securities companies was emphasized in the third chapter. The object of this study is the securities company in China. A general introduction of the current development and operating status of securities companies in China as well as opportunities and problems that were faced during development was described in this part.The fourth chapter,evaluation and analysis of the securities companies operating efficiency. The source and selection criteria of the samples in this study were elaborated in the first section in this part. Definition and selection of input and yield indicators were made in this part and evaluation index system of sample were established in this part. Data will be extracted from respective annual report after samples and indicators are determined. Preliminary efficiency measurement and decomposition analysis of securities company samples were made based on determined method and indicators in the second and third section. In addition, index system and projection analysis were established according to the result.Chapters:total factor productivity of securities companies in China are measured and analyzed in this part.Based on the Malmquist Index,the changes of efficiency indicators and technological progress status of the selected securities companieswere measured, in order to fully understand what are the influential indicators and factors to the company performance.In the end, conclusions weregiven,while suggestions and recommendations are provided to those companies to improve the status of their performance. Additional to that, the short come of this research was listed and suggestions were made for further research on this topic.Securities companies generally have the problem of low in innovation level as well as lack of risk management. Based on the sample study, those securities companies have good performance, but on the other hand, technical performance is in the low level and it even remaining to an even lower level.Under the assortment management method, it shows that the higher the level, the better the performance; listed companies in general outweighedthe non-listed ones. The transformation of the brokerage company proved that innovation has direct impacts on the efficiency of securities companies. Total factor productivity change index measure results show that, the main reason of negative growth in securities firms total factor productivity is due to the lagging technical development; meanwhile, this also led to the low level of risk management capacity whichaffects the efficiency.According to the efficiency measure results, this researchestablishes a benchmark system and providesresponsive results. Thus,the optimal pathwhich could improve the performance of non-inefficient companies was given.