García-Herrero, Alicia
[Verfasser:in]
;
Gavila, Sergio
[Sonstige Person, Familie und Körperschaft];
Santabárbara, Daniel
[Sonstige Person, Familie und Körperschaft]
What Explains the Low Profitability of Chinese Banks?
Erschienen in:Banco de Espana Working Paper ; No. 0910
Umfang:
1 Online-Ressource (34 p)
Sprache:
Englisch
DOI:
10.2139/ssrn.1413123
Identifikator:
Entstehung:
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 2, 2009 erstellt
Beschreibung:
This paper analyzes empirically what explains the low profitability of Chinese banks for the period 1997-2004. We find that better capitalized banks tend to be more profitable. The same is true for banks with a relatively larger share of deposits and for more X-efficient banks. In addition, a less concentrated banking system increases bank profitability, which basically reflects that the four state-owned commercial banks - China's largest banks - have been the main drag for system's profitability. We find the same negative influence for China's development banks (so called Policy Banks), which are fully state-owned. Instead, more market oriented banks, such as joint-stock commercial banks, tend to be more profitable, which again points to the influence of government intervention in explaining bank performance in China. These findings should not come as a surprise for a banking system which has long been functioning as a mechanism for transferring huge savings to meet public policy goals