| Summary: | 碩士 === 輔仁大學 === 金融研究所 === 98 === The MOU (Memorandum of Understanding) was officially signed on Nov. 16th, 2009 , Then Taiwan and China was officially-recognized of ECFA(Economic Cooperation Framework Agreement) on Jun. 29th ,2010 which is the way to eliminate tariff and non-tariff trading obstructions with each other. MOU and ECFA are the window opportunities for Taiwan domestic banks to entry the China Financial Market. In recent years (from 2000 to 2009), the spread between the rates of saving and lending - the indicator of profit and operation environment - went down from 2.99% to 1.23%. Meanwhile, the average ROE and ROA were 0.28% and 4.49% separately in 2009 for Taiwan domestic banks. However, the ROE and ROA were 0.84% and 15.07% separately for China Banks at the same time. The main cause for this circumstance is excessive competition in Taiwan financial market and the companies in Taiwan have been moved to China and Southeast Asia is the sub-cause.
The banking industry in Taiwan is not internationalized enough. According to the “Regulations Governing Approvals of the Taiwan domestic banks to Engage in Financial Activities between the Taiwan Area and the Mainland Area” promulgate by the FSC (Financial Supervisory Commission), the banks which operate OECD business at least 5 years will be qualified to process application to entry Mainland market which constraint many banks to moving forward. In an excessive competitive environment, it is undoubtedly for Taiwan domestic banks must to expand their business to China Financial Market. The reasons for Taiwan domestic banks eager to be internationalized are as follows.
1. The internal market is over developed
2. A lot of companies moved to Mainland and Southeast Asia, Cash flow also moved out from Taiwan
3. The China Financial Market is booming
4. An enormous market opportunity of companies of Taiwan in China so called follow the clients
Based on the O-L-I analysis of Dining’s Eclectic Theory, entry China Financial Market as the base of foreign-investment for Taiwan domestic banks is objectively and essentially. However, the Taiwan domestic banks do not planning and arranging the financial market in China as long as the manufacturing industry. Meanwhile, Beijing had announced the “Regulations of the People’s Republic of China for the Administration of Foreign Banks” in 2006 in order to make the commitment to open its financial market officially for join the WTO in 2001. Apparently, the banks which have not entry the China Financial Market yet are far behind their competitors. Furthermore, the brand attractiveness of Taiwan domestic banks is well enough for in the Chinese people or corporations which will make Taiwan domestic banks more difficult to expand their business in China. The product line of Taiwan domestic banks is not well enough compare to the world-wide leaders in financial industry. The edge of Taiwan financial institutions is the knowledge of companies of Taiwan in China. However, unlike other industries, the exit mechanism is much more complex for financial institutions. Overall, the Taiwan domestic banks have to make decisions after a good deal of contemplation to be more competitive in Mainland financial market.
This research synthesizes finally induces the research conclusion, and proposes the concrete proposal, will enable provides the Taiwan Domestic Banks in the future strategy formulation, to drawing up the development policy and the law reference of with the government Controlling organization.
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