人力资源之BC中国银行业的竞争优势.docx

THE BOSTON CONSULTING GROUPChina Crossroads:Competitive Prioritiesfor Chinese BanksSeptember 2002China Crossroads: Competitive Priorities for Chinese Banks1ShanghaiBoston Consulting (Shanghai) Company Ltd.21st Floor, Central Plaza227, Huangpi Bei LuShanghai, 200003 CHINATelephone: 86-21-6375-8618Facsimile: 86-21-6375-8628E - m a i l : BeijingThe Boston Consulting Group (Beijing)3rd Floor, North Tower, Beijing Kerry CentreNo.1, Guang Hua Road Chaoyang DistrictBeijing, 100020 CHINATelephone: 86-10-8529-8877Facsimile: 86-10-8529-8878E - m a i l : Hong KongThe Boston Consulting Group International, GmbH34th Floor, Shell TowerTimes Square, Causeway BayHong Kong, CHINATelephone: 852-2506-2111Facsimile: 852-2506-9084E - m a i l : The Boston Consulting Group is a generalmanagement consulting firm that is a globalleader in business strategy. BCG has helpedcompanies in every major industry andmarket achieve a competitive advantage bydeveloping and implementing uniquestrategies. Founded in 1963, the firm nowoperates 54 offices in 34 countries. Forfurther information, please visit our Web siteat .Copyrightc2002 by The Boston Consulting Group, Inc.All rights reserved. Published in September 2002.Report designed by BCG Greater China marketing team.2China Crossroads: Competitive Priorities for Chinese BanksCONTENTSPrefaceExecutive Summary1. Where Is Chinas Banking Industry Today?1.1 Reforms underway: shift occurring to market-driven environment1.2 Market is large but still in a nascent and emerging phase1.3 Three key challenges facing the industry1.4 Banking industry is at a major crossroads today2. What Competitive Scenarios Are Likely To Play Out?2.1 Landscapes - defined by geography and product2.2 Five possible competitive scenarios2.3 Inferences for China and the banks2.4 What should the banks do now?3. What Are The Priorities For Chinese Banks To Compete?3.1 Priority #1 : Strengthen organization and corporate governance3.2 Priority #2 : Develop a segmented service capability3.3 Priority #3 : Build a strong risk management framework and culture3.4 Priority #4 : Maximize operational efficiency3.5 Priority #5 : Use partnerships for competitive advantage4. How Should Banks Begin To Create Winning Game Plans?4.1 The importance of strategic planning4.2 Key strategic planning challenges in China5. What Are The Key Implications For Management?6. ConclusionsChina Crossroads: Competitive Priorities for Chinese Banks457891317181818212224242732344042424345483PrefaceChinas accession to the World Trade Organization (WTO)marked a new era in the global economy. For the first timeafter more than forty years in a controlled market, Chinatook the step towards fully opening its doors to foreigntrade partners. Step by step, these partners will establishtheir bases in China, enjoying equal access to one of thebiggest and fastest growing economies in the world.insights may be equally enlightening to foreign bankingexecutives who contemplate entering the Chinese market.Drawing on experience from other markets that haveundergone sweeping banking reforms, the paper will alsoexplore five plausible competitive scenarios in China.Banking players are urged to monitor regulatory directionsand market forces closely to gain early insight into thechanging landscape and to set their priorities.This is both good and bad news for the Chinese banks.On the one hand, this market stimulus will intensifyeconomic growth, opening more opportunities for them.On the other hand, the Chinese banking industry haslimited internal capabilities and is still heavily burdenedby massive non-performing loans. Foreign competitionis hardly welcomed.With the market transforming, fierce competition looming,and significant opportunities ahead, Chinas bankingindustry is at a crossroads of change. Standing still is notan option as institutions confront both the onslaught ofThe paper is based on The Boston Consulting Groups(BCG) broad experience in advising banking clients inChina and globally, supplemented by publicly availableinformation. Special thanks go to the project team, ledby Sean Jiam, and to many BCG colleagues who developedmuch of the thinking in this report. They include MinCao, Jie Feng, Joseph Kwok, Sin Beng Ong, Connie Yu,Simon Yuen, and Vivian Zheng. We would also like tothank the BCG officers who contributed their insights:Thomas Achhorner, David Gilmour, Jim Hemerling, DavidMichael, Roman Scott, Peter Wetenhall, and John Wong.new competitors and the equally daunting challenge offinding the right direction for themselves.“China Crossroads: Competitive Priorities for ChineseThis paper discusses the uncertainties facing the Chinesebanking industry and identifies some strategic prioritiesthat banks must address. Although the papers primaryaudience is the senior management of Chinese banks, theGiles BrennandVice President and DirectorThe Boston Consulting Group34th Floor, Shell TowerTimes Square, Causeway BayHong Kong, CHINATel: 852-2917-8236Fax: 852-2506-9084E-mail: Banks” provides an in-depth look at the Chinese bankingindustry at a momentous time in its evolution. Wewelcome your feedback and encourage you to contactus.Tjun TangManagerThe Boston Consulting Group21st Floor, Central Plaza227, Huangpi Bei LuShanghai, 200003 CHINATel: 8621-6375-8618Fax: 8621-6375-8628E-mail: 4China Crossroads: Competitive Priorities for Chinese BanksExecutive SummaryFar-reaching reforms have rippled through the competitivelandscape of Chinas banking industry. The countrysentry into the WTO will likely catalyze further change.Chinese banks need to re-evaluate their business models,set clear strategic agendas for the future, and strengthentheir internal capabilities in order to survive in a newcompetitive order.Set against this context, the goal of this paper is to setout plausible scenarios for future competition, and todefine the keys to success. The paper also seeks to providea prescriptive strategic agenda for senior Chinese bankingexecutives so that they might better identify and developthe capabilities they will need. Obviously, the prescriptionmust be tailored to the specific aspirations, heritage andcondition of each duct scope and geographic reach. Within thesedimensions exist five competitive structures that warrantanalysis for a better understanding of Chinas futurebanking landscape.Specialists Rule: Market specialization acrossproductsEra of the Warlords: Geographic fragmentationBlossom of a Hundred Flowers: Market specializationand geographic fragmentationAny Model That Works: Selective market specializationand fragmentationWar of the Giants: National universal bankingClearly, it will take several years for the new landscape toform and stabilize. In the meantime, Chinese banks mustarm themselves with the capabilities to compete*regardless of how it actually takes shape.Chinas financial regulators, over the past two decades,have set in motion a series of market-oriented reformsthat have edged the banks closer to true competition.The countrys entry into the WTO will further lowerbarriers into its banking markets. Foreign institutions arealready poised to enter, attracted by strong growthpossibilities. Some Chinese banks are also raising thecompetitive bar, having learned from internationalpractices and the disciplines of free markets.What remains unclear is the timing and pace of reforms,which makes it difficult to forecast the future shape of thefinancial services industry with any certainty. However,based on developments in other markets around the world,several scenarios can be identified for how the competitivelandscape might evolve.Five Scenarios For Future CompetitionBanking markets can be described along two dimensions:Key Priorities for Chinese BanksBCG recommends that Chinese banks focus on fivepriorities to strengthen their competitive capabilities:Priority #1: Strengthen organization and corporategovernancePriority #2: Develop a segmented service capabilityPriority #3: Build a strong risk managementframework and culturePriority #4: Maximize operational efficiencyPriority #5: Use partnerships for competitiveadvantageKey Success Factors For ImplementationBCG suggests six principal factors for successfulimplementation of these initiatives:A. Develop a compelling vision for actionChina Crossroads: Competitive Priorities for Chinese Banks5B. Have visible, committed leadership willing to tackletough issuesC. Use rigorous project management techniquesD. Actively obtain the support of key stakeholdersE. Fill gaps in capabilities and cultureF. Put in place the right support infrastructurePreparing For The Road AheadOver the past few years, Chinese banks have successfullynavigated a difficult environment. However, theroadblocks will now be larger and the stakes higher. Thereare three practical steps that the banks can take to preparefor the future:1. Make sure the entire senior management teamrealizes the imminent challenges ahead, and feelsthe urgency to acquire the capabilities needed todeal with them2. Develop a realistic plan to move beyond thecrossroads3. Pursue implementation of the plan with appropriatevigor and flexibility6China Crossroads: Competitive Priorities for Chinese Banks1. Where Is Chinas BankingIndustry Today?China today is one of the largest banking markets in theworld. Total bank assets amounted to US$1.9 trillion in2001, comparable to advanced markets such as the UnitedKingdom, Germany, and France. Assets have beengrowing at an annual compounded rate of some 15% forthe past five years. The level of bank assets relative togross domestic product (GDP), at over 160%, is alsoamong the highest in the world. Sustained growth andthe long-term potential of the Chinese market, set againsta stagnant global economy, is attracting many foreignbanks.The rapid growth of the Chinese banking sector over thelast decade has been assisted by a relatively stablemacroeconomic environment and Chinese householdshigh propensity to save. The high degree of bankintermediation also reflects the relative underdevelopmentof Non-Bank Financial Institutions (NBFIs) and thesecurities market in China. While large, Chinas bankingsystem suffers from a large overhang of non-performingassets, conservatively estimated at 25% or more of totalloans. Still, despite mounting internal problems, theChinese banking industry is expected to grow in globalimportance.Exhibit 1.0.1Chinas Banking MarketSizeable and Growing FastBank Assets20%GDP US$ BnGrowth Rate(1)(%)15%10%IndiaChinreeceU.S.Hong Kong5%U.K.FranceJapanSingapore0%ChileGermanyBank Assets As0%50%100%150%200%250%300%350% of GDP(2)(%)South Africa-5%PhilippinesPortugalMalaysiaIndonesia-10%Thailand(1)(2)CAGR 1997-2002Data as of year ended 2001Source: World Competitiveness Report, 1998-2002China Crossroads: Competitive Priorities for Chinese Banks71.1 Reforms underway:shift occurring to market-drivenenvironmentThe transformation of Chinas financial sector began inearnest around two decades ago, commencing withregulatory reform and culminating with marketderegulation. There are five key stages:Pre-1991: Building of the banking infrastructureIn 1984, Peoples Bank of China (PBOC) relegated thelending business to the newly established state banks,marking the creation of the modern financial system. Overthe following decade, the PBOC built on this foundation,gradually introducing legal structures and encouraginginterbank transactions.1991 to 1995: Acting as cashiers to economic transformationTo preserve control over capital allocation during thetransformation of the economy, the state banks maintainedtheir traditional role as state treasurers, directing capitalfrom households to both State-Owned Enterprises (SOEs)and emerging shareholder enterprises. Only toward theend of this period did the banks themselves recognizethe need to become more profit-driven. Subsequently,Exhibit 1.1.1Transitioning Toward Market-Oriented Environmentthey applied more rigorous risk management measures.1996 to 2000: Embracing market reformsDuring this period, through a series of reforms, policy-mandated lending gave way to a more market-driven formof lending. Economic reformers recognized that effectivecommercial credit disciplines were crucial to appropriateallocation of capital among newly restructured enterprisesin all sectors of the economy. At the same time, interestrate deregulation and limited entry of foreign institutionscatalyzed competition. These changes prompted theintroduction of increasingly diverse products, such asconsumer financing.2001 to 2005: Preparing for free market competitionIn late 2001, China entered the WTO. This momentousstep is expected to create a more level playing field forboth domestic and foreign banks. Under its WTOcommitments, China agreed to liberalize its commercialbanking sector in a phased approach. In anticipation ofcompetition, the authorities continued to implementaggressive plans to enhance the strength of domesticplayers. Accordingly, the authorities are expected to floatownership of the state banks within 5 years, leading themtoward full independence.Stage 1:Building of thebanking infrastructureStage 2:Acting as cashiers toeconomic transformationStage 3:Embracing of marketreformsStage 4:Preparing for freemarket competitionsStage 5:Free marketcompetition19841991199419951996199719992000200120032006WTOBankingbusinessPBOC relegated itslending business to thenewly established statebanksEstablish nationalinterbank marketStart of interestrate deregulationConsumerlendingpromotedIntermediary businesslegitimizedLending ratefurtherderegulation?Full operationsof foreignNew regulationof corporatebond?banks will beallowedSupervisionPassage ofBanking lawCommercialbank lawFinancial bill lawSecurities andinsuranceregulatory bodiesindependent fromPBOCCurrencyUnification of RMBexchange rateRMB currentaccountconvertibilityRMB capitalaccountconvertibility?Source: Literature search; BCG analysis8China Crossroads: Competitive Priorities for Chinese Banks2006 and onwards: Free market competitionBeyond 2006, product and geographical limitations onforeign banks will be completely phased out. The Chinesebanking industry will for the first time follow the rules oftrue open markets.improvementMarket conditions are primitive and immatureSimple, basic products are the normCorporate governance still insufficientInadequate capabilities and weak core*infrastructureRegulatory environment still developing1.2 Market is large but still in anascent and emerging phaseThe Chinese banking market is significant andevolvingDespite its size, the Chinese banking industry remains atan embryonic stage of development. Its keycharacteristics are laid out below:The Chinese banking market is significant andevolvingLarge market, dominated by corporate bankingHealthy growth expected in retail bankingMarket is more geographically fragmented than inLarge market, dominated by corporate bankingThe legacy of state-directed lending created withinthe state-banks a large stock of corporate loans worthsome US$760 billion, making up around 91% of theirtotal loan portfolios. However, recent moves towardmarket reform have slowed growth in corporatelending. Consumer loans are now driving growth inthe state banks loan portfolios.EuropeHealthy growth expected in retail bankingPlayers are heterogeneous, but all have profitabilityproblemsTop four sta