Theory and Practice
New Horizons in International Business series
Chapter 8: Summary and Conclusions
Chapter 1 identiﬁes six key issues in the analysis of banking internationalization. They are motivation, mode of control, determinants for market entry, development strategy, management and adaptation, and competitive advantages. Policy and host country environment greatly aﬀect the market entry. Learning and cultural diﬀerences are crucial elements in the adaptation and development of foreign banks. Interrelations of these variables are of great importance and will be highlighted in this ﬁnal chapter. Chapter 2 develops a theoretical framework using internalization theory as a synthesizing element and integrates other theoretical concepts from strategy literature. Emphasizing knowledge as a key factor that drives the growth of banks, we rely on primary data collected from subsidiary level to examine the dynamics of banking internationalization in China’s emerging economy. Our ﬁndings and our contribution to the existing literature must be taken within the speciﬁc circumstances of our empirical investigation. The sample is drawn from 37 in-depth interviews and 60 postal questionnaire surveys of 178 foreign banks in China. Banks from diﬀerent nations operating at diﬀerent modes (representative oﬃce, branch, subsidiary and JV) are included in our sample, which provides triangulation of all ﬁndings. We can be conﬁdent of the robust and reliable nature of our results. This conclusion encapsulates our ﬁndings on the identiﬁed key issues. STRATEGIC MOTIVES Foreign banks exhibit a mix of motives including both market seeking and following the client and other motives of which driven by competition, being the ﬁrst mover, geographical...