Bank Lending Channel Of Monetary Policy Transmission

This paper in order to gain following purpose. Fist, testing whether Chinese commercial banks with different size respond differntially to impact of monetary policy. Second, testing whether Chinese commercial banks with different liquidity respond differntially to impact of monetary policy.Third, testing whether Chinese commercial banks with different capital respond differntially to impact of monetary policy. Fourth, testing whether Chinese commercial banks with different profitability respond differntially to impact of monetary policy.We investigate the bank lending channel of monetary policy transmission for Chinese commercial banks from1986to2009. The results show that the characteristics of Chinese commercial banks play an important role in the bank lending channel. The impact of monetary policy is weaker for large-scale banks and banks with abundant capital, but it is stronger for banks with more liquid assets and high profitable ability. When banks are shocked by monetary policy, the characteristics of Joint-stock commercial banks including size, liquidity, capital, and profitability play a more significant role than State-owned commercial banks. Finally, we put forward some policy based on the conclusion of this paper.