Graduation Year

Fall 2012

Document Type

Campus Only Senior Thesis

Degree Name

Bachelor of Arts

Department

Economics

Reader 1

Richard Burdekin

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© 2012 Yancan "Lydia" Li

Abstract

Many Chinese commercial banks have experienced ownership transitions during the past decade, along with significant improvements in performance. In order to examine the effect of ownership on bank performance, an empirical study of Chinese commercial banks is performed. A dataset covering 16 Chinese commercial banks over the period of 2002 — 2011 is tested using linear regression model and principle component analysis. It is found that being a Joint-Stock Commercial Bank has a positive effect on earnings per share (EPS), and being a City Commercial Bank increases return on assets (ROA). On the contrary, operating as a Stated-Owned Commercial Bank affects both EPS and ROA negatively. The empirical results also indicate that undergoing initial public offering on the Hong Kong Stock Exchange helps a bank to improve performance, while the listing in Mainland China does not.

This thesis is restricted to the Claremont Colleges current faculty, students, and staff.

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