Wednesday, February 14, 2018
Competition and Profitability in the Chinese Banking Industry: New Evidence from Different Banking Markets
Yong Tan, University of Huddersfield - Business School examines Competition and Profitability in the Chinese Banking Industry: New Evidence from Different Banking Markets.
ABSTRACT: This paper significantly contributes to the banking literature by testing competition in different banking markets (deposit market, loan market, and non-interest income market) using a sample of Chinese commercial banks over the period 2003-2013 and further examining the impact of competition on bank profitability. The results show that the non-interest income market has a higher level of competition compared to the other two markets during early years of the examined period. The findings further report that higher competitive deposit market leads to lower profitability of Chinese commercial banks.