The Research On Efficiency Of Banks Of Qingdao Area Based On DEA

Since entering the WTO, China’s banking financial institutions directly faced the challenges of economic globalization and financial liberalization, and faced increasingly fierce competition. Bank efficiency has increasingly become a measure of bank competitiveness, and also a close concern to the entire socio-economic development. In April2003, the CBRC (China Banking Regulatory Commission) separated from the People’s Bank of China, and became a full-time banking supervision and management department. This represents the rapid rise of the diversified development of China’s financial sector. The banking financial institutions play a crucial role in the economic development of a country, and its efficiency can directly affect a country’s economic development..If narrowing the scope of the banking financial institutions to a region and studying the efficiency of all banking financial institutions of this region, it will obviously have a very good theoretical and practical significance.The main body of the research in this article is the research of the Qingdao region’s banking financial institutions, and the selected data is the relevant variables data of22bank financial institutions from year2006to year2011. The22selected banking financial institutions are divided into seven categories:policy banks, large state-owned commercial banks, joint-stock commercial banks, city commercial banks, rural credit cooperatives, local financial companies, foreign banks. In the empirical analysis, fully considering the relationship between the input and output, the selection of the input variables are capital/working capital, number of employees and deposits; and the selection of output variables are interest income and non-interest income. This article use DEA model to do efficiency analysis of sample banking financial institutions. First, the CCR model is used to get the technical efficiency. Then, the BCC model is used to get pure technical efficiency and scale efficiency, which are the decomposition of technical efficiency. Finally, the Malmquist model is used to get changes in total factor productivity, technical efficiency change, scale efficiency change, pure technical efficiency change and technological advances change.The article is divided into five chapters, the main structure and content is organized as follows:Chapterl is Introduction. This chapter introduces the research background and significance of this article, and also introduces the research methods and research framework.Chapter2is the literature review. This chapter summarize the study of domestic and foreign commercial banks, and point out the problems and shortcomings of the domestic paper.Chapter3is the theory of bank efficiency and measure theory. The emphasis of this chapter is about the bank efficiency and bank efficiency measurement.Chapter4is about the empirical research of the efficiency of Qingdao banking financial institutions. First, in this chapter, we use the CCR model and BCC model to get the efficiency of sample bank financial institutions, and the results are statics; then we use the Malmquist model to get the dynamic efficiency of the samples.Chapter5is the conclusions and recommendations. Based on Chapter measure results and the sample banks report data, this chapter give a summary that why the institution have good efficiency while others not. Then, at the last, we put forward a number of specific recommendations to improve the efficiency of banking financial institutions.In the article, we have some conclusions as follows:(1) In the study year (2006-2011), the efficiency of the banking financial institutions of Qingdao have increased rapidly.(2) The global financial crisis has little effect on the efficiency of the banking financial institutions of the Qingdao area. Qingdao banking financial institutions appeared the transient efficiency setbacks in the year2008-2009, but flew back to the efficiency immediately in the year2009-2010.(3) Both the technical efficiency and the technological progress have contribution to the efficiency of Qingdao banking financial institutions.(4) The size of the banking financial institutions in Qingdao area is not reasonable.(5) Pure technical efficiency of Qingdao banking financial institutions have a positive role in the overall efficiency, but not so obvious.(6) Local banking financial institutions (Haier Finance, Qingdao Bank) have the highest efficiency in all banking financial institutions.(7) The large state-owned bank efficiency has been higher efficiency than the joint-stock commercial banks. Until2011, this trend reversed.(8) Foreign banks did not always maintain high efficiency and began to decline ranking from2009.(9) The rank of policy banks’efficiency has improved; and the rank of rural credit cooperatives has been the lowest.