China's Commercial Banks Liquidity Monitoring Index System Construction And Empirical Research

It is well known that liquidity is the key aspect to decide normal management ofcommercial banks. It is also the basis to guarantee normal work of the national entirefinance system. "Two Conferences" gave a new explanation of liquidity. The liquidity ofbank system in our country includes excess reserve that financial system reserves in theCentral Bank and cash holding. It is the foundation of financial system in creatingcurrency.The commercial bank should maintain its liquidity in a reasonable area. When theliquidity is insufficient, the commercial bank will go into risk, similarly, when theliquidity is excess, the commercial bank will also go into risk. Commercial banks are themain body of the financial system in our country, and their management goal is profitmaximization, just as other enterprises. Only by keeping a reasonable liquidity, acommercial bank can effectively avoid risk and realize its ultimate object.Firstly, according to the historical experience and the present condition in ourcountry and experience of other countries, we reconstruct an indicator system on the basisof the old one which is used in our country now in this paper. And we still unify the riskof liquidity insufficiency and excess liquidity.Next, we analyze the liquidity of the whole financial system in our country. Then weanalyze the liquidity of state-owned commercial banks and other joint-stock commercialbanks by the new indicator system. From the result, we can conclude that state-ownedcommercial banks have excess liquidity, and other joint-stock commercial banks haveinsufficient liquidity.Finally, according to the different problems that exist in state-owned commercialbanks and other joint-stock commercial banks, we analyze their reasons deeply andpropose the corresponding suggestions, expecting making some trifle contribution to theliquidity management of our country commercial bank system.