A Study On The Shareholding Structure And Performance Of Chinese Listed Banks

At present, the world’s economy has developed with the unprecedented speed andsize. The economic integration of the world has not only promoted the world nations’economy with fast development speed, but also has taken great challenges to the worldnations. However, the world has formed " flourish of all of caustic of one caustic all,one flourish " relation, which means the economic crisis of one country will result intothe financial crisis of the world. Based on this background, the world nations begin tocarry out to assimilate and combine their financial institutions and to improve thecorporate governing mechanism so as to face and treat the fierce competition of theworld’s finance. Sine the opening up, the foreign banks with strong financial strength,sound corporate governance and advance management experience have entered intoChina gradually, which surely strength the competition between Chinese and foreignbanks. Face with competition pressure of foreign banks, Chinese banks have toaccelerate their reform pace. Meanwhile, the national commercial banks start to goingpublic and try to increase their core competitiveness by every means.As a result of the inrush of foreign investment, it brings a new kind of stock rightto the commercial banks, that is shareholding of foreign investors. Changes inshareholding structure will improve interior governing structure, operation andmanagement of the commercial banks, which surely will act on the banks’ operationperformance finally. The shareholding structure is regarded as property right basis of thegoverning structure of a corporate. The validity decides the efficiency of corporategovernance greatly, which further influences the corporate’ performance level. Because of banking is the foundation of one country, its operating performance is related to thedevelopment of the national micro-economy, so research on the relationship betweenshareholding structure and operation performance becomes very important. Firstly, fromthe two levels of the shareholding structure, by researching on the influence ofshareholding structure and ownership concentration to the performance and bycombining the status of the shareholding structure of Chinese listed banks and theiroperating performance, this paper explains the relationship between shareholding andperformance further. Secondly, by regarding Chinese banks listed during2006and2011as sample data and by using the method of principal component analysis to fix thebank’s aggregative performance, this paper has tested and verified the relationshipbetween the bank’s shareholding structure and its performance by establishing theregression model. By empirical test, this paper concludes that the relative concentratedownership structure is helpful to improve Chinese listed bank’s performance. And theshareholding rate of the largest shareholder and the five largest shareholders are allnegatively related to the bank’s performance. The reinforcement of the equity restrictionratio is helpful to increase the bank’s performance. As for shareholding composition, theratio of national share in the ten largest shareholders is negatively related to the bank’sperformance, and the shareholding ratio of domestic legal person and foreigninvestment have weak yet positive correlation with corporate performance. Increase ofthe proportion of circulated shares has a positive effect to the performance. Lastly,subject to shareholding structure, this paper points out some optimized measures toimprove banks’ performance level.