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ID: 112403

Corporate governance and bank performance in China / Jiang, Chunxia; Feng, Genfu; Zhang, Jianhua

Jiang, Chunxia	Journal Article
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2012.

Summary/Abstract

This paper examines the effects of corporate governance on bank performance in China over the period 1995-2008. Bank performance has improved significantly and the mean profit efficiency level is estimated at 61%. The results suggest that differences in corporate governance have significant impacts on bank performance: banks with majority foreign ownership are most profitable while banks with majority state ownership are most unprofitable. We find no evidence that foreign minority ownership in domestic banks improves performance. Banks with more dispersed ownership are found to be more profit efficient.

Key Words

Corporate Governance ; SFA ; Chinese Banking

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ID: 092540

Effects of governance changes on bank efficiency in China: a stochastic distance function approach / Jiang, Chunxia; Yao, Shujie; Zhang, Zongyi

Yao, Shujie	Journal Article
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Publication

2009.

Summary/Abstract

China has accelerated banking reform since joining the Word Trade Organisation (WTO) in 2001. Employing a stochastic distance function approach, this paper examines bank technical efficiency and differentiates the static, selection and dynamic governance effects on bank efficiency for the 11-year period 1995-2005. The results show that bank efficiency has improved. Joint-stock ownership is associated with better performance in terms of profitability than state ownership (static effect). Strong selection effects are found for both foreign acquisition and going public reform strategies. Foreign acquisition may benefit domestic banks by efficiency gains in the long run, but privatization via initial public offerings (IPOs) appears to have only some short-term effects.

Key Words

China ; Banking ; Efficiency ; Distance Function

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