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Comparing the performance of Chinese banks: A principal component approach [An article from: China Economic Review]
Book Details
Author(s)V. SHIH, Q. ZHANG, M. LIU
PublisherElsevier
ISBN / ASINB000PDSKZE
ISBN-13978B000PDSKZ2
MarketplaceIndia 🇮🇳
Description
This digital document is a journal article from China Economic Review, published by Elsevier in 2007. The article is delivered in HTML format and is available in your Amazon.com Media Library immediately after purchase. You can view it with any web browser.
Description:
Using previously unavailable central bank data, this paper first uses principal component analysis to derive four measures of a bank's ability to perform the core task of financial intermediation. This study then compares the performance of China's state banks, joint-stock banks, and city commercial banks along these measures. In terms of overall performance and in credit risk management, joint-stock banks perform significantly better than both the state banks and the city commercial banks. In China, unlike in other developing countries, the size of the bank is not correlated with their performance. Mid-size national joint-stock banks perform considerably better than the Big Four banks and smaller city commercial banks (CCBs). We further conduct regional and jurisdictional analysis of the CCBs, which indicates that a mix of geographical and historical legacies drives the substantial variation in CCB performance.
Description:
Using previously unavailable central bank data, this paper first uses principal component analysis to derive four measures of a bank's ability to perform the core task of financial intermediation. This study then compares the performance of China's state banks, joint-stock banks, and city commercial banks along these measures. In terms of overall performance and in credit risk management, joint-stock banks perform significantly better than both the state banks and the city commercial banks. In China, unlike in other developing countries, the size of the bank is not correlated with their performance. Mid-size national joint-stock banks perform considerably better than the Big Four banks and smaller city commercial banks (CCBs). We further conduct regional and jurisdictional analysis of the CCBs, which indicates that a mix of geographical and historical legacies drives the substantial variation in CCB performance.
