The research on the competitiveness of commercial banks by factor analysis

The bank competitiveness has a significant relationship to the development of banks, the competitiveness of commercial banks in China is still lower than that of the advanced foreign countries. The accurate evaluation of bank competitiveness has a great significance for the development of financial industry. The paper makes a research on the competitiveness of Chinese commercial banks and establishes the index system which measures a bank´s competitiveness from the aspects of scale, safety, liquidity and profitability. By using the method of factor analysis, the article makes the analysis of 16 commercial banks in China, eventually comes to rank the competitiveness of commercial banks. The results have a practical significance to improve the competitiveness of Chinese commercial banks. Finally the article gave suggestions and countermeasures on the development of Chinese banking industry.