中国银行业的改革和盈利能力毕业论文中英文资料对照外文翻译文献综述.docx

中国银行业的改革和盈利能力毕业论文中英文资料对照外文翻译文献综述.docx

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中国银行业的改革和盈利能力毕业论文中英文资料对照外文翻译文献综述

中英文资料对照外文翻译文献综述

China’sBankingReformandProfitability

Erh-ChengHwaYangLei

1.Introduction

TheWorldBank（1997）onceclaimedthatChina’sfinancialsectorwasthesoft-bellyintheeconomy.Financialsectorreformhaslongbeenarguedasnecessarytoraiseefficiencyintheuseofthecapitalandinrebalancingtheeconomytowardconsumption-basedgrowth,withoutwhichthecountry’sgrowthsustainabilityisinjeopardy（seeLardy,1998;Prasad,2007）.Indeed,nottoolongago,China’sstatebanksweredeemed“technicallyinsolvent”andtheirsurvivalhingedsolelyonthenation’sabundantliquidity.However,afterthelaunchingofbankingreform,strongprofitabilityhasreturnedtostatecommercialbanksrecently.Butitmaybetooearlytodeclareacompletevictoryonbankingreformasyet,sinceChinesestatebankshaveembarkedonthepathofreformnottoolongago.Inaddition,theirstrongfinancialperformancehasriddenonthebackofstrongbutunsustainablegrowth.Asgrowthhasbeguntosoftenundertheweightofaglobalrecessionin2008,banksareexpectedtonavigateinamoredifficulteconomicterrainthanhitherto.Theaimofthispaperisnottoevaluatetheeffectofbankingreformonbankperformance,whichisbettertackledafterthecompletionofafullcreditcycle.Rather,ouraimistotakestockoftheprogressinreformingChina’sstatebanksbyreviewingthebankingreformstrategyandanalyzingtheirrecentstrongpost-reformfinancialperformancewhich,however,cannotbeentirelyseparatedfromreformseffortsundertakenthusfar.

Thispaperhasthreesections.InSection2,wereviewthereformstrategyofChina’slargestatebanks,whichisthemainthrustofChina’sbankingreform,aswellasitsimplementation.TheSection3analyzes2007financialperformancefocusingonthefourlargeststatecommercialbanksthathavefloatedsharesinthemarket:

IndustrialCommercialBankofChina（ICBC）,ChinaConstructionBank（CCB）,BankofChina（BOC）,andBankofCommunications（BOCOM）.TheconspicuousexceptionisAgricultureBankofChina（ABC）,whichisstillintheprocessofrestructuringformarketlistingatanappropriatetimelater.Section4concludeswithanassessmentonbankperformance.

2.BankReformStrategyandItsImplementation

2.1.Bankreformstrategy

Beforereform,statebanksweresolelyownedbytheStateandservednationaleconomicpolicygoals.1Sincetheywerenotwhollyprofit-makingcommercialentities,commoncommercialbankingcriteriaforevaluatingtheirfinancialperformancedonotapplystrictly.Nevertheless,assoonasthecountrydecidedtoembarkuponthepathofasocialistmarketeconomyintheOctober1992CCPCongress,commercializationofthestatebankshadbecomeaforegoneconclusion.Thegoalofbankingreformistoturnstatebanksintocommercialentitiesthatarecompetitiveinthemarketplaceandcanprovideefficientintermediationofthenation’ssaving.Giventheirdominanceinfinancialintermediation,thebanksplayacrucialroleintheefficientallocationofcapital.

2.1.1.Creatingtheenablingenvironmentforbankingreform

Thecountry’smarketreformandopeningprogramhasgreatlyacceleratedsince1992wheninOctoberthatyearthe14thCCPCongressdeclaredthatthegoalofreformandopeningwastocreateasocialistmarketeconomy,whicheffectivelyendedtheexperimentalnatureofeconomicreformandopeningprogramlaunchedsincethelate1970s.Thefirmingupofmarket-orientedreformshascreatedanenablingenvironmentforahostofreformscentraltothesocialistmarketeconomyconstructincludingforemostthebankingreform.Inearly1994,inresponsetotheinflationthreat,thegovernmentlaunchedmacroeconomicreformencompassingcentralbanking,exchangeratemanagement,andfiscalpolicyandtaxation.Themacroeconomicreformpermittedthecentralauthoritiestoregainmacroeconomiccontrollosttolocalauthoritiesinthedecadeofthe1980sunderthedecentralizationpolicyof“fangquanrangli”.2Whiledecentralizationusheredaperiodofrapidgrowth,italsogeneratedsignificantmacroeconomicinstability.Indeed,thepursuitofmacroeconomicreformsignificantlydampenedmacroeconomiccyclesinthe1990s.

Second,inthesameyear,thegovernmentcreatedthreepolicybanks—StateDevelopmentBank,AgricultureDevelopmentBank,ChinaExportImportBank—torelievestatecommercialbanksoftheirtraditionalpolicymandates.

Third,thegovernmentpromulgatedcentralbankingandcommercialbankinglawsin1995toprovidethelegalfoundationforbankingreform.

Fourth,beginningfrom1996thegovernmentbegantovigorouslypursuitenterprisereformthatpavedthewayforbankingreform,eventhisresultedinlargeandpainfullayoffsofredundantstateworkers.Pursuing

enterprisereformaheadofbankingreformwasnecessaryconsideringthatstate-ownedenterpriseswerethemainclientsofstatebanksandhencetheirmainsourceofnon-performingloansNPLs,whichwasatthesametimethecontingentliabilitytothegovernment.Hence,unlessthereformofstateownedenterprisestakeshold,anyreformeffortofthestatebankswouldbeinvain.Ontheotherhand,assoonasthestate-ownedenterprisereformwaspressedforward,thebankingreformcouldnolongerbepostponed.Thisisbecauseasstate-ownedenterpriseswererestructured,liquidated,merged,orbankruptedoutofexistence,thebanksmuststarttorecognizethehiddenlossesontheirbooks.This,inturn,triggeredtheneedtorecapitalizethebanks,asalargeamountofnon-performingloanwaswritten-off.

Fifth,theStateCouncilinFebruary2002decidedtoreformsolelystateownedcommercialbanksintointernationallycompetitivefinancialenterprises,transformthemintostate-controlledshareholdingcommercialbanks,andencouragelistingtheirsharesinthemarket.

Sixth,ChinaBankingSupervisoryCommitteewascreatedin2003toraisetheregulatorycapacitytosupervisebanks.Finally,adheringtothe2001WTOaccessionagreement,thegovernmentusestheentryofforeignbanksintothelocalbankingmarkettoinjectcompetitivepressuretothelocalbankingindustryinordertogainefficiency.Beginningfromtheendof2006,foreignbankscanengageinlocalcurrencybusiness.

2.1.2.Reformingcorporategovernanceandrestructuring

thebalancesheet

Thecountry’slargestatebankshavefollowedseveralstepstoundertakeinternalcorporatereform.Thefirstistoreformthecorporategovernancebyinvitingotherinvestorstodilutethesolestateownershipwhilestillretainingitsdominance.Inparticular,thebankshavemadeanefforttoseekforeignstrategicpartnershipwiththeviewtobringinginmodernbankingpracticesandtechnology.Thebroadeningofownershipalsoentailssellingaportionofbanksharestotheequitymarkettomakebankmanagementaccountabletothemarketplace.Tosuccessfullywoooutsideinvestors,beitstrategicpartnersorpublicinvestors,thebanksmustputforwardacreditableinhousereformplanandimplementitcredibly.Nodoubt,thebetterandmorecredibletheinternalreformplanis,themorelikelyitisforthebankstoattractreputableoutsidepartnersandfetchabetterdealwiththeircounterpartsorintheequitymarket.

Hence,thefirststepthegovernmentundertookwastostrengthenthebalancesheetofstatebankswhosecreditflowshadbeencloggedupbyinadequatecapitalandpilesofbaddebtsaccumulatedunderthepreviouseconomicplanningregime.In1998,thegovernmentissuedRMB270billion（US$32.6billion）worthof30-yearfiscalbondstorecapitalizethebalancesheetsofthefourlargeststatebanks:

ICBC,BOC,CCB,andABCinordertocomplywiththeinternationalcapitaladequacystandards.Again,onDecember30,2003,thegovernmentprovidedUS$22.5billioneachtoCCBandBOC,withUS$15billionprovidedlaterinApril2005toICBCtosupporttheirrespectivelistingsintheHongKongstockexchange.Amongthefourlargeststatebanks,CCBwasthefirsttohaveitssharessuccessfullylistedintheHongKongstockexchangeandthusthefirsttohaveitsreformeffortpassedbythemarkettest.Inaddition,aspartoftheschemeofrecapitalization,thebanksalsoissuedsubordinateddebttothelocalmarket:

BOC,RMB60billion;CCB,RMB40billion;ICBC,RMB35billion;andBOCOM,RMB12billon.

In1999,thegovernmentcreatedfourassetmanagementcorporationsAMCs,oneforeachofthe“bigfour”:

ICBC,CCB,BOC,andABC,tomanageRMB1.4trillionofloanspurchasedfromthebooksofthestatebanksatfacevalue,ofwhich1.3trillionweredeemednon-performing（about15%ofGDP）.Thetransactionwasfinancedpartlybycentralbankloan（RMB573billion）andpartlybytreasurybonds（RMB820billion）.AsecondtransferringofNPLsintheamountofRMB1.186trilliontotheAMCstookplaceduringtheperiodfromJune2004throughJune2006.

Thebanksalsolaunchedreformmeasurestoimproveinternalmanagementincludingstrengtheningthehumanresourcebase,introducingmodernriskmanagementpractices,andmovingupthestandardofNPLclassificationtocomplywiththeinternationalstandards.

2.2.Implementationofreform

2.2.1.Seekingdiversificationandattractingforeignstrategicpartners

Followingtheblueprintofreform,thebankshavesuccessfullylaunchedandimplementedthereformstrategy.ICBC,CCB,BOC,andBOCOMallhavetheirfullstatestakeinthecompanydilutedtobelow70%byincorporatingnon-stateownerships,whichincludesforeignownership,domesticlegalpersons,andpublicownership（publiclyownedandtradedshares）.Amongnon-stateowners,foreignstrategicpartnershipusuallyhasthehigheststakeinthecompany:

ICBC,7.2%,BOC,13.9%,CCB,10.3%,andBOCOM,18