Research On The Effect Of Managerial Overconfidence On The Commercial Bank Leverage Ratio

The global financial crisis triggered by the US subprime mortgage crisis had a serious negative impact on the world's economic development.After an in-depth study,the Basel Committee realized that the high leverage in the bank was the culprit of the crisis.In 2010,the Basel Committee issued the Basel III,introducing a risk-free leverage index.At the same time,the influence factors of bank leverage become the focus of academic research.With the prevalence of behavioral finance,the influence of managers' psychological bias on corporate leverage is widely concerned by academics.Domestic and foreign research shows that managers' business decisions are affected by their psychological bias,and psychological research found that excessive self-confident managers generally have excessive self-confidence psychological bias.Therefore,managerial overconfidence on the impact of corporate leverage into academic research focus.With the deepening of China's financial reform,commercial banks have become the mainstay of the national economic and financial system.In fact,stable operation is particularly important for the sustained and stable development of China's economy.Excessive leverage leads to the accumulation of risks in the banking system.Once the crisis occurs,not only is the bank facing the threat of bankruptcy,China's economic development will suffer a great negative impact.Therefore,to maintain a reasonable level of leverage is not only the commercial banks to achieve sound management of the inherent requirements,but also to protect China's economic development an important prerequisite.Domestic scholars have found that China's commercial bank managers have excessive self-confidence psychological bias,this psychological bias through the bank's investment and financing behavior of commercial banks leverage.The research on the leverage rate of managers in China is mostly concentrated in the general business,and the research on this special enterprise of banks is rarely heard.Therefore,this article from the perspective of behavioral finance to discuss the impact of managerial overconfidence on the leverage of China's commercial banks,to a certain extent,can enrich the relevant research on bank leverage.This article is divided into five chapters,the specific contents are as follows:Chapter 1,Introduction.Firstly,it discusses the research background and significance of this paper,and clarifies the necessity and importance of the influence of research manager's overconfidence on the leverage ratio of China's commercial banks in our current environment.Secondly,through the review of domestic and foreign research results,The author puts forward the research ideas,methods and research contents of this paper.Finally,it expounds the innovation and shortcomings of this paper.Chapter 2,related concepts and theoretical basis.First,it expounds the five related theories involved in this paper,namely,behavioral finance theory,agency cost theory,signal transfer theory,Orderly financing theory and control theory.Finally,the author analyzes the influence path of managers' excess confidence on bank leverage in theory.Chapter 3,managerial overconfidence and the status quo of commercial bank leverage.First of all,from the gender,age,education,whether to serve as the board of directors and the five personal characteristics of the time,to study the performance of China's commercial bank managers overconfidence,and based on the management of managers overconfident comprehensive analysis of China's commercial bank managers There are some self-confidence;Secondly,from the commercial banks at the level of capital,liabilities and the composition of the assets inside and outside the scale and analysis of the composition of China's commercial banks leverage ratio;Finally,from the regulatory point of view,through the relevant data analysis of China's commercial bank leverage Of the compliance situation.Chapter 4,the manager of excessive self-confidence on the bank leverage analysis.First,according to the theoretical analysis and the existing research results,five assumptions are put forward from four aspects: bank financing mode,leverage rate,non-performing loan ratio and capital yield.Secondly,the Ordered-probit model is constructed and the three This paper chooses the sample data of 20 commercial banks in China from 2005 to 2015,and divides the samples into two large commercial banks and small and medium-sized commercial banks.And the descriptive statistical analysis of the relevant data was carried out by using the R software respectively.Finally,the model was established and regression was performed on the basis of the Hausman test.The results show that overconfident managers are more inclined to debt financing,especially short-term liabilities;managers overconfident will reduce the leverage of small and medium-sized commercial banks in China;bank leverage will lead to lower bank lending rate,while reducing Bank 's return on assets.Chapter 5,Findings and Policy Recommendations.First,the conclusion of this paper is summarized on the basis of the empirical results.Secondly,the author puts forward some policy suggestions from the managers,the commercial banks and the government.Finally,the future research direction is prospected.