State-owned Chinese banks lag behind in efficiency, reforms needed for improvement.
The study looked at the efficiency of Chinese commercial banks from 2000 to 2010 using a method called network DEA. They found that state-owned banks are not as efficient as shareholding banks, but they perform equally well in terms of pure technical efficiency. State-owned banks are more affected by government policies and financial crises, while shareholding banks are more stable. The efficiency of Chinese commercial banks has been improved by reforms in stock structure. Suggestions for improving efficiency were also provided based on the rankings of the banks.