The Study On The Efficiency And Its Influencing Factors Of Rural Commercial Bank In China

China’s first rural commercial banks were founded in 2001 in Jiangsu Province.After ten years of reform and development, rural commercial banks have made great progress in quantity, asset size and quality, distribution and other aspects. They quickly become an important part of the rural financial system and play a crucial role in serving farmers, agricultural and rural areas, supporting rural economic development and promoting urban-rural integration. In recent years, with the development of china’s economy and deregulation of rural finance, more and more financial institutions began to enter the rural areas which make rural commercial banks face a huge challenge. Due to limited resources and intense competition, rural commercial banks should improve their efficiency to survive and gain a sustainable development. Therefore, it is significant to have a study on the level of the efficiency,its influencing factors of rural commercial bank and how to improve the efficiency in china.On the basis of existing research results, this paper focuses on the micro efficiency of rural commercial banks and influencing factors. Firstly, we explain the meaning of the efficiency of commercial banks, the categories of bank efficiency and method of measuring the efficiency of the bank. Secondly, we choose 12 rural commercial banks, 4 state-owned commercial banks and 4 joint-stock commercial banks as samples. Then we calculate and compare banks’ efficiency from 2009 to 2012 with the method of DEA. The results show that the efficiency of rural commercial banks is the lowest among the three types of commercial banks. Then use the fixed effects panel data model analyzes the influencing factors of rural commercial banks.The results indicate that the asset size, loan-to-deposit ratio and non-interest income ratio represent a significant positive impact on the efficiency of rural commercial banks which means a larger asset size, a higher loan-to-deposit ratio and non-interest income ratio will contribute to a higher efficiency of rural commercial banks.However, capital adequacy ratio, NPL ratio and equity ratio of the top ten shareholders suggest a significant negative impact on the efficiency of rural commercial banks. Finally, through the summary of above normative analysis and empirical research, we try to put forward some feasible countermeasures and suggestions about how to improve the efficiency of rural commercial banks.