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China's entry to the WTO: managerial implications for foreign banks

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  • M.K. Leung

    (Department of Business Studies, Hong Kong Polytechnic University, People's Republic of China)

  • T. Young

    (School of Economic Studies, University of Manchester, Manchester M13 9PL, UK)

Abstract

This paper shows that particular attributes of foreign banks, viz. size of assets, number of branches, and links to the Asian network, have significant impacts on their decision to engage in business transactions in China's domestic currency, Renminbi. Access to these markets will expand upon China's entry to the WTO and these attributes will also help the foreign bank to manage liquidity and credit risks more effectively when dealing with their Chinese customers. Other foreign banks without these attributes will have to adopt aggressive employment policies or restrict themselves to providing services to joint ventures in China. Copyright © 2002 John Wiley & Sons, Ltd.

Suggested Citation

  • M.K. Leung & T. Young, 2002. "China's entry to the WTO: managerial implications for foreign banks," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 23(1), pages 1-8.
    • Handle: RePEc:wly:mgtdec:v:23:y:2002:i:1:p:1-8
    DOI: 10.1002/mde.1036
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    References listed on IDEAS

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    1. John H. Dunning, 1977. "Trade, Location of Economic Activity and the MNE: A Search for an Eclectic Approach," Palgrave Macmillan Books, in: Bertil Ohlin & Per-Ove Hesselborn & Per Magnus Wijkman (ed.), The International Allocation of Economic Activity, chapter 12, pages 395-418, Palgrave Macmillan.
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    1. repec:zbw:bofitp:2018_019 is not listed on IDEAS
    2. Li Xian Liu & Fuming Jiang & Milind Sathye & Hongbo Liu, 2021. "Are Foreign Banks Disadvantaged Vis-À-Vis Domestic Banks in China?," JRFM, MDPI, vol. 14(9), pages 1-36, August.
    3. Kjell Sümegi & Peter Haiss, 2006. "The Relationship of Insurance and Economic Growth - a Theoretical and Empirical Analysis," EcoMod2006 272100091, EcoMod.
    4. Zou, Hong & Xiao, Jason Zezhong, 2006. "The financing behaviour of listed Chinese firms," The British Accounting Review, Elsevier, vol. 38(3), pages 239-258.
    5. Korkeamäki, Timo & Virk, Nader & Wang, Haizhi & Wang, Peng, 2019. "Learning Chinese? The changing investment behavior of foreign institutions in the Chinese stock market," International Review of Financial Analysis, Elsevier, vol. 64(C), pages 190-203.
    6. Peter Haiss & Kjell Sümegi, 2008. "The relationship between insurance and economic growth in Europe: a theoretical and empirical analysis," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 35(4), pages 405-431, September.
    7. Korkeamäki, Timo & Virk, Nader & Wang, Haizhi & Wang, Peng, 2018. "Learning Chinese? The changing investment behavior of foreign institutions in the Chinese stock market," BOFIT Discussion Papers 19/2018, Bank of Finland, Institute for Economies in Transition.
    8. Zou, Hong & Adams, Mike B., 2006. "The corporate purchase of property insurance: Chinese evidence," Journal of Financial Intermediation, Elsevier, vol. 15(2), pages 165-196, April.
    9. M.K. Leung & T. Young, 2005. "Entry of foreign banks in Shanghai: implications for business strategies in an increasingly competitive market," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 26(6), pages 387-395.

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