Application Of EVA In Evaluating The Performance Of Chinese Commercial Banks

Along with the economic development of our country has entered the " 13th Five-Year" planning stage,the role played by commercial banks in China's financial system become more and more important.Commercial banks as the implementation of the "control valve" of the central bank's monetary policy and national economic regulation,its normal operation is the key to the realization of China's successful economic development plan,are the solid foundation for the realization of per capita for China income in 2020 to reach the goal of moderately developed countries.With the domestic market and further liberalization of national bank policy of "no",the domestic banking industry has entered into a new stage:more and more foreign capital to seize the domestic market share;banking and Internet service height;rise of domestic emerging private bank.These factors make the commercial banks in China face more and more severe living environment.In this context,the application of the performance evaluation of commercial banks becomes more and more important.In recent years,driven by banks own personnel quality promotion and the influence of the "Internet+",the service level is become higher and higher.The highly service of the banking industry requires the performance evaluation system not only to evaluate themselves,but also to be able to evaluate the product,evaluate the customer,and evaluate the competitors.In order to achieve this goal,the economic value added(EVA)performance evaluation mechanism is gradually used in the listed banks at home and abroad.Economic value added(EVA)core is the efficiency of the use of capital,specifically refers to the target enterprise financial statements in the net profit minus the total capital cost.The significance of economic value added(EVA)is to adjust the financial data so that the EVA value is more close to the real economic profit,which is the biggest characteristic of the EVA performance evaluation system.In the theory of economic value added(EVA),the profit of the enterprise should be defined as the residual of the two part of the total income minus the operating cost and the minimum expected rate of return of investors.This paper based on the background of the reform of commercial banks in China,W branch of the city P plays an important role in a regional branch system as an example,W branch of the existing EVA and key indicators of performance evaluation system(KPI)as the starting point,to explore the W branch in the performance rating system problems,and put forward relevant suggestions.Value of the original performance appraisal system of domestic banks usually focus on the report of "income and profit",does not really assess the cost and risk of the current profit need,to evaluate the target to create the largest market value.EVA performance evaluation system can make up for the deficiency of traditional performance evaluation system in the aspects of equity capital cost and the sustainable development of enterprises.But at present,the research on EVA in our country is still in the initial stage,and the particularity of our country's national conditions,the research in this field can not fully apply the advanced experience of foreign countries.How to explore a suitable for China's commercial banks to implement,with "Chinese Characteristics" of the EVA performance evaluation system is an important guarantee for China's commercial banks to achieve a smooth transition.Based on the above considerations,this paper first to choose this topic and the background,the present research situation of the topic,the framework and specific content(research methods)and the existing innovation points are elaborated,and then introduces the performance evaluation of commercial banks EVA and related basic theory and analyzes the advantages of EVA performance evaluation system relative to the traditional performance evaluation system.The focus of this paper is to W branch's case analysis,analysis of the current W branch performance evaluation system,and puts forward the solution to the problems(the introduction of new performance evaluation index,and according to the author)during the internship in W branch(2015-2016)calculation method to collect relevant business data exploration gives the new index.The last part of this paper is mainly about the improvement of the EVA performance evaluation system of commercial banks in China,the relevant recommendations and conclusions.