The Research On The Impact Of New Capital Regulation On The Credit Behavior Of Rural Credit Cooperatives

After the outbreak of the global subprime mortgage crisis,the previous capital regulatory accord has proved to be problematic and the current regulatory system has also been questioned.The need of strengthening supervision of the capital and stabilizing the financial system is becoming increasingly urgent.Many international financial regulatory authorities such as Basel Committee on Banking Supervision has promptly revised and adjusted the current guidelines and regulations.On September 12,2010,new international regulatory standards,the Basel? Accord,has been issued.On January 1,2013,Measures of Commercial Bank Capital Management(For trial implementation),issued by China Banking Regulatory Commission,has officially taken effect,stipulating that the capital adequacy ratio must meet the national requirement by the end of 2018.At this point,China has entered its new era of capital regulation.At the same time,with the changing trend of capital regulation and the development of the rural economic system reform in China,rural credit cooperatives,the mainstay of China's traditional rural financial system,is now faced with many new challenges and choices.Based on the analysis of the trend of rural finance and the environment in which rural credit cooperatives grow,deposit and loan servicing will remain to be the core servicing for a long time which rural credit cooperatives rely on.However,with the improvement of China's capital regulatory system,it is difficult for rural credit cooperatives to choose between increasing the capital and reducing the scale of loan servicing to ensure its capital adequacy ratio.With the goal of protecting the operation of rural credit cooperatives and stabilizing rural financial system,this paper will take the credit behavior of rural credit cooperatives as an example and focus on the relation between the implementation of the new regulatory standards and the scale of rural credit servicing.In the beginning,this paper gives a detailed description of main content about all Basel Accords and how ideas of capital regulation have developed with a comparison with the current situation of capital regulation of rural credit cooperatives to identify the deficits of the capital regulation of rural credit cooperatives in China in the next part.Based on the analysis of data drawn from field trips to rural credit cooperatives in nine areas around Fujian,using the method of multivariate linear regression model,the last part concludes that the credit servicing will be shrank by the implementation of the new regulatory standards and the rural economy will be affected as a consequence.Moreover,measures of improving the capital regulatory system of rural credit cooperatives are provided as suggestions.