Research On Orientation Of Community Banks In China Based On The Perspective Of Efficiency And System Design

Although at present our banking industry has different banks with relatively complete sizes and type, but in the competition, the position to the target customers and the business scope are deviating, large banks launched fierce competition with small and medium-sized banks in the increasingly homogenized trend on service:in the past, large banks scramble for large customers but now they scramble for small customers with small and medium-sized banks. Regardless of their own ability and efficiency, small and medium-sized banks pursuing big fight blindly. Whether the community branches or the small and medium-sized banks, both have had the "shape" of the American community bank, but the lack of mature system environment and the lack of law on relevant system design leading to the absence of substantive function orientation of community banks, banks in rural areas and poor areas tend to absorb deposits from local but use them to developed areas with high return on capital because of instinct profit-seeking, leading the vulnerable groups turn to "underground finance", disrupting the normal order of the financial markets, is not conducive to promote the efficiency of banking industry as a whole. When the regulators perfect the system design, make different sizes of bank clear its own position in the market, it can be produced in accordance with its function orientation of community Banks, therefore, making a clear positioning of community banks is very necessary and important.In this paper, first of all, I make an introduction on the discussion of the theoretical definition of community banks and its function orientation, than introduce the present situation and the existing problems of the community branches and the small and medium-sized banks. Secondly, from the Angle of system, I select the experience of American community bank as reference and comparison, analyze the specific system environment features of community banks in the United States and the remarkable development achieved in the more mature financial environment. The most worthy of reference point, also is one of the innovation of this article, namely the recommendation on reference 《Community Reinvestment Act》 in the United States, making legislative constraints to community banks in China. Improving the efficiency of banks is essential to enhance the competitiveness of banks, therefore, it is particularly important to give a clear positioning to the community banks based on the perspective of bank efficiency. The article use the related theory of new institutional economics, expound the community banks’ positioning problem respectively from property, scale and system based on efficiency. On this basis, the design of system is arranged from macroscopic and microscopic aspects:one is the overall framework, including the entry and exit system, legal system, supervision system and credit system construction, etc., the second is the arrangement of the internal, including property rights and organization structure, business model, the access speed and network distribution, etc.The main conclusion:first, it will be conducive to promote the efficiency of community banks and the whole banking when the regulators make clear system specification with strong operability. We can draw lessons from the 《Community Reinvestment Act》,make rules that banks of different size have the obligation of reinvestment to the backward community, check and ratify different proportions, after reaching a certain evaluation standard we can reduce the proportion, to implement the function orientation of community Banks, carry out the pratt&whitney financial policy. Secondly, the bank should choose reasonable scale of operation according to their circumstance, with the scale becomes bigger, the efficiency not always becomes higher. To avoid further homogeneity, different sizes of banking institutions should choose their strategic positioning from the "global Banks, national Banks, community Banks" on the basis of in-depth analysis of their respective characteristics and advantages and service ability, stick to choose what should do. Thirdly, the paper puts forward the view that new community banks should use clear private holding property, and improve the efficiency of property rights.