Capital Dynamic Adjustment Behavior Analysis Under The Dual Of Capital Regulation And Liquidity Supervision

Liquidity and capital are the two important defense line of the bank’s response to the external shock, they complement each other, and jointly safeguard the steady operation of the bank. Under the framework of Basel Committee, capital regulation has long played an important role, while the liquidity supervision has not been paid enough attention.2008 sweeping the global financial crisis, the global financial system and the real economy has been a great impact, highlighting many of the defects of the original regulatory, Basel committee decided to reform the current regulatory system, in 2010 launched the Basel agreement Ⅲ and the liquidity risk measurement, standards and monitoring of the international framework and a series of new regulatory policies, marking the new direction of future global financial supervision and new standards. Although our country has withstood the test of the financial crisis, it has demonstrated a strong ability to resist risks, but not because of the perfect supervision system, but because the degree of financial openness and development in China is far from the European and American countries. However, with the gradual implementation of the interest rate market and the financial market, we have to make a careful summary of the experience and lessons of international banking supervision, which have important implications for improving the effectiveness of the supervision of our country, better to play the real economy of the banking services, and maintain financial stability.Previous studies on the capital adjustment behavior, mostly based on the static study of the capital supervision and regulation, did not highlight the dynamic behavior of capital adjustment, and did not pay attention to the effect of liquidity supervision on capital adjustment behavior and the effectiveness of capital regulation. Therefore, this paper constructs a theoretical model based on the dual constraints of capital supervision and liquidity regulation, and introduces the penalty function, and analyzes the influence of capital regulation and liquidity supervision on the dynamic adjustment of capital. It is found that capital regulation has positive incentive effect on capital adjustment, and the effect of liquidity on bond and loan holding amount. Further, the paper also analyzes the effect of regulatory penalty measures on capital adjustment. Finally, the paper analyzes the effect of capital supervision and liquidity regulation on capital adjustment.In order to better reflect the dynamic adjustment behavior of Chinese commercial banks, this paper selects 61 commercial banks from 2004 to 2014 in China by using GMM regression method, and analyzes the effects of capital supervision, liquidity supervision and punishment measures on capital adjustment. Empirical test results show that:(1) Capital supervision and liquidity pressure have a positive role in promoting capital growth, and the more stringent penalties, bank capital adjustment speed, the regulatory pressure and the implementation of punitive measures against the bank has a strong deterrent effect. (2) Liquidity supervision has strengthened the positive sensitivity of bank capital to capital supervision pressure, which indicates that the liquidity supervision is an effective supplement to capital regulation. (3) Core capital and subsidiary capital have a positive impact on the growth of total capital, and the contribution of the former to total capital growth is significantly higher than the latter, indicating that banks are more inclined to equity capital financing way.