Research On Dividend Policy Of Postal Savings Bank Of China

Since the reform and opening up,China’s economy has experienced continuous growth for decades.As a stabilizer and amplifier for the economy,the financial industry has undergone profound changes and rapid development.The implementation of the Basel Capital Accord makes the capital adequacy of banking institutions an important measure to measure institutional and systemic financial risks.The important position of bank credit intermediaries also shows that the healthy development of banks themselves plays an important role in the macro economy..As an emerging large state-owned commercial bank with a large asset size and a relatively important financial position,the Bank is listed on the Hong Kong Stock Exchange in 2016 and distributes cash dividends at a certain percentage each year.The amount and continuity of dividend distribution reflects the company’s governance and management level,as well as the rationality of the company’s capital structure and the company’s future development.The theoretical research on dividend policy has been in existence since the 1930 s.In recent years,the scope of dividend policy research has gradually expanded,and the dividend distribution of listed banks has gradually become a research topic.This paper takes the Postal Savings Bank as the research object and studies its dividend distribution policy.Firstly,using the case analysis method,collect and sort out the dividend policies and related business indicators of the listed banks and other domestic banks of H-share market over the years,and analyze them with relevant theoretical knowledge.Then using descriptive statistics to analyze the correlation between the life cycle of all Hong Kong-listed domestic banks and the level of dividend payment in 2006-2016,and verify whether life cycle theory is applicable to such institutions.The analysis finds that the life cycle of domestic listed banks is significantly positively correlated with the level of dividend payment,and the more mature the enterprise,the more likely it is to distribute dividends.On this basis,the paper finds that there are problems in the dividend policy of the Postal Savings Bank,including the dividend payout rate is lower than the average level of the listed banks in the mature period,the low profitability affects the net profit level,the existence of the proxy problem between the major shareholders and the minority shareholders.Then using the literature analysis method,combined with the research results of domestic and foreign dividends,to find the reasons for the problems in the dividend policy of the Postal Savings Bank.The study finds that there are three reasons for the distribution of dividends in the Postal Savings Bank.Firstly,the relative lack of capital to restrict the distribution of dividends.Secondly,the principal-agent model affects the profitability of enterprises;Finally,it is difficult for small and medium-sized shareholders to form effective constraints on major shareholders.Finally,in view of the main causes of problems in the dividend policy of the Postal Savings Bank,combined with the characteristics of the banking institutions and the Postal Savings Bank,the solutions are proposed.Firstly,it is necessary to improve the ability of capital acquisition and management,including actively issuing perpetual bonds and accelerating A-share,promoting asset securitization and focusing on asset structure.Secondly,it is necessary to expand the company’s business code,including doing a good job in postal and banking cooperation,developing small and micro loans,increasing the proportion of non-interest income,and improving customer satisfaction.Finally,we are supposed to strengthen the construction of internal control mechanisms,increase the share of equity and decision-making power of small and medium-sized shareholders,form checks and balance mechanism within the company,and reduce agency costs as much as possible.