The Effective Analysis on Government Recapitalization for State-owned Commercial Banks

摘要

Since 1998 Chinese government has provided capital injections for four major state-owned commercial banks with the ways such as the issue of special treasury bonds, stripping off the non-performing assets (NPAs) and the use of foreign exchange reserves. In this way, the capital adequacy ratio has been much increased and stockholding system transformation has been carried out in the banks. In the respect of the efficiency of state-owned commercial banks, government recapitalization has a positive correlation with the efficiency of banks. Moreover, competitiveness of banks could be enhanced with government capital injections and stockholding system transformation.