Spillover Effects of International Strategic Alliance in Banking Industry of China: Perspectives from Chinese Firms

Hou, Yuxuan (2014) Spillover Effects of International Strategic Alliance in Banking Industry of China: Perspectives from Chinese Firms. [Dissertation (University of Nottingham only)] (Unpublished)

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This research examines the spillover effects of international strategic alliances in China’s banking industry for Chinese domestic banks. Through adopting spillover effects theory in explaining the positive and negative effects leaking from foreign investors in international strategic alliances, the study enables us to compare the internal and external effects depending on different factors, as Chinese state owned national banks and local banks as well as the country of origin. All of the analyses will be based on four mechanisms of spillover effects including demonstration effects, building domestic linkages, employee turnover and competition effects.

Using the case studies of a Chinese state owned national enterprise Bank of Communications (BoCom)’s strategic alliances with a British bank Hongkong and Shanghai Bank Corporation (HSBC) as well as a local bank Shanghai Pudong Development Bank (SPDB)’s strategic cooperation with the American firm Citibank, we find that Chinese state owned national bank and local banks performed differently in attracting foreign investment, meanwhile foreign banks from different countries also vary considerably. As for the overall spillovers, the positive effects are leaked from imitating modern commercial banking philosophy, advanced management skills and modern technologies, improving intangible resources through employee turnover and gaining motivations to compete with other banks. However, foreign investors also can bring threats that results in crowed-out effects. In reference to the domestic factors, Chinese state banks and local banks differ in some aspects. Local banks have stronger motivations of learning foreign know-how and building linkages due to the lack of governmental supports and small technology gap while state banks performed better in competing with other banks than local banks. In terms of external factors of country of origin, banks from United Kingdom have different effects on Chinese banks compared with American banks. It is seems that British banks prefer to establish long-term partnerships because of governmental supports while the American incentive policies encourage banks to expand into international markets and compete with other financial institutes.

Item Type: Dissertation (University of Nottingham only)
Depositing User: EP, Services
Date Deposited: 11 Nov 2014 15:14
Last Modified: 22 Oct 2016 09:16
URI: http://eprints.nottingham.ac.uk/id/eprint/27262

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