An Evaluation Study On The International Competitiveness Of China’s Commercial Banks

With the complicated and changeable international financial markets, aswell as the Interest rate liberalization and opening capital market, it’s aformidable challenge for China’s commercial banks to improve itsinternational competitiveness to immune from the elimination by internationalmarket with the global economic integration. So it has great significance forour banking industry for an objective assessment of internationalcompetitiveness of China’s commercial banks, in the background thatdomestic’s monetary system reforming and the impact from foreign banks. Itis also the main point of this paper.Based on the researches by predecessors at home and abroad, this papergives a accurate definition of international competitiveness of commercialbanks, in a free and fair market, with the more attractive price or the betterquality of service than the other competitor at home and abroad, thecommercial banks that participate in the international competition got theadvantage of the international market’s approval. Then take the Chen Yvlu’sdiamond model of international competitiveness of commercial banks as theresearch frame, construct the14indexes contained internationalcompetitiveness of commercial banks’ evaluation system, the system are tier1capital, total assets, equity that reflecting commercial bank’s scale ofoperation, average return on capital, return on equity that reflectingprofitability, deposit growth rate, loan growth rate, assets growth rate thatreflecting development capacity, non-interest income ratio, capital adequacyratio, loan-to-deposit ratio reflecting innovation and steady, and overseasincome ratio, overseas profit before tax, brand value that reflectingcommercial bank’s international operating conditions. Based on thisevaluation system, select30large-scale commercial banks at home andabroad as the research specimens, using the factor analysis concentrating4main factor that representative commercial bank’s internationalcompetitiveness, then gives an evaluation on each main factor andinternational competitiveness. At last, the paper draws the conclusion asfollows；First is that Chinese commercial banks’ international competitiveness made further development while the western banks’ industry got regressionand adjustment; the second is based on the empirical conclusion, ourcommercial banks has a great disadvantage on the foreign income andfinancial innovation, and the interest rate liberalization is the developmenttrend in the future, it will getting harder and harder to get the most of theoperating revenue just rely on interest margin, it means a lot for commercialbanks to develop Intermediary Business, financial innovation andinternational markets.