Scope And Standards Of The Central Bank Refinancing

Re-loan of central bank is considered as a vital measure of financial stability.At present,there exists huge re-loans of the people's bank of china(PBC,the central bank of China) with the amount above 2,000 billions.The re-loans of PBC have played a significant role in the rapid economy growth of the past 30 years upon Chinese reforming and opening up and contributed a lot to the control of financial risk after financial crisis in Asia.But it has also lurked with potential monetary risk,inflation risk and even moral hazard.Basing on analyzing the situation and statute of re-loans of PBC,the dissertation put forwards necessary suggestions and comments to perfect the system of re-loans of PBC from the view of comparative study.The dissertation is divided into preface,main text and epilogue.In main text,there are three parts.The first part centers upon the theoretic summary of re-loan of central bank.It illustrates the systemic background, the theory development and the cost as well as the negative effect tagged off by it.The second part studies on alien re-loan of central bank's criterion and limitation by introducing the classic model and practice of re-loans of the central bank.It draws conclusion that the contagion and moral hazard is a key factor when the central bank implements re-loan aid.However, more attention should be paid to the problem of contagion initiated by the bankruptcy of financial institutions.The third part focuses on the situation of re-loans of PBC.Through retrospection PBC's supporting and aiding to the various financial institutions,it proves that against the systemic background of unsound compensation and bankruptcy mechanisms and shortcoming of the valid laws and regulations,re-loans of PBC factions seems too broad.Lastly it puts forwards concrete legislative suggestions and comments in the establishment of compensation and bankruptcy mechanisms,the enhancement of PBC's right of independent policy-making,and the perfecting of the criterion and limitation of re-loan of PBC.