Scale Expanding and Efficiency Improvement of Commercial Banks of China

Abstract

Operating efficiency of commercial banks is essential to keeping financial basis of the country. Analyzing effect based on Principal Components Analysis show that during 1999 to 2003, improving of efficiency of stock banks mainly depended on expanding of bankspsila scale. But on improving of technical and profit-making efficiency, the stock banks lagged behind the state-owned banks. Moderate competition is a fundamental approach to growing of efficiency especially profit-making of Chinese banks. So, building a system which may promote moderate competition between banks is necessary.