Study on impact of foreign banks entry to China banking

Chinese banking are becoming more and more open-up after entering World Trade Organization. In the paper, we positively analyzed effect of open-up of Chinese banking and drew conclusions as following: under rigid regulation on banking, foreign banks entry exerts some competition press on Chinese banking. But foreign banks have limited market share and business, so their entry has little effect on increase of Chinese banking efficiency. Domestic banks still can gain monopolistic profit. But in a long run, Chinese banks will keep their dominant role, and foreign banks will gradually increase their shares, but they should do much preparation and innovation.