The Empirical Study On The Risk Spillover Effects Of Small And Medium-sized Enterprises Financing On Shadow Banking In China

After the financial crisis,China's national economy began to recover,as an important support for the real economy,small and medium-sized enterprises have mushroomed and rapid development.However,when China's capital market was not perfect,bank credit is the main form of capital supply,but it is difficult to make up for the huge gap between small and medium-sized enterprises.At this time,shadow banking as a form of financial innovation began to appear in the Chinese capital market.Because its approval speed,low loan threshold,simple procedures and other characteristics,it could solve the financing difficulties of SMEs timely.Therefore,SMEs have gradually become an important financing channel and made up for the shortcomings of the bank's regular loans.At the same time,shadow bank scale began to expand rapidly yet.In recent years,China has gradually strengthened its support for the real economy at the policy level.The fifth session of the National Finance Work Conference held from July 14 to 15,2017 clearly pointed out that we should Co-ordinate the allocation of financial resources and take the service economy as the starting point and the foothold of financial work.It is estimated that by the end of 2016,China's shadow bank funds have reached 47.2 trillion RMB,accounting for 30.28%of the total size of social financing.Although the emergence of shadow banking brings the hope of financing small and medium enterprises,but because most of the small and medium-sized enterprises are"family hereditary system" and management is centralized and single,which easily lead to imperfect internal management system,and they often appear financial fraud,debt and other negative events,so that their credit rating is low and social credibility gradually decreases.At the same time,due to the small size of SMEs themselves,value of things could be used for mortgage-backed asset is lower.Therefore,in order to get the risk premium,the shadow banking institutions often issued the SME credit with higher rates,which undoubtedly increased the burden of SMEs and easily lead to small and medium enterprises appear default,so as to bring risks to the shadow bank.The purpose of this paper is to explore the risk spillover effect of shadow banking when small and medium-sized enterprises appear extreme risk,so as to provide suggestions for rationalizing the financing of SMEs and the supervision of shadow banking.There are many literatures on the relationship between small and medium-sized enterprises and shadow banks,the financing difficulties of SMEs and the influence of shadow banks on the financing of SMEs,but the literatures which can make small and medium enterprises of the financing dependency is quantified and inspect the size of the risk of spillovers in shadow banks are rare.And,these are also the main innovation of this article.Therefore,this paper classifies shadow banking as bank-type shadow banking and non-bank shadow banking,and estimates the size of funds for different types of shadow banks firstly.Then,the cash-cash flow sensitivity model is used to quantify the financing dependency of small and medium-sized enterprises on various types of shadow banks.Finally,the ARMA-GARCH-CoVaR model is used to measure the risk spillover effect of small and medium-sized enterprises on various types of shadow banks.The results show that the financing dependence of the banks on the bank's internal shadow banks is weak,but there are different levels of risk spillovers for all types of banks.Among them,the risk of spillover of the five major state-owned commercial banks is the strongest,eight joint-stock banks and three urban commercial banks have a considerable and weak risk spillover effect,indicating that state-owned commercial banks are still the main source of funds for small and medium-sized enterprises.Small and medium-sized enterprises mostly rely on the financing of private lending shadow banking and the second is the trust shadow banking,but the risk spillover effect of the enterprise to the trust shadow banking is stronger than that of the non-governmental loan which is characterized by the "small and scattered" nature.The financing dependence and risk spillover effects of SMEs on securities shadow banks are the least due to the fact that the funds of the securities bank mostly flow into the capital market to obtain excess returns and rarely flow into the entities.Due to China's financial supervision is relatively strict,the forms of shadow banking more subtle,which almost infiltrates the entire financial market at all levels.As a result,the shadow bank has a long chain of funds and a high level of leverage.When it is damaged,it is easy to transfer the risk to the entire financial market,and lead to financial systemic risk.However,the main output of the shadow banking funds and the source of the benefits are poorly qualified small and medium enterprises,thus,EMEs are also the important risk source of shadow banks.The research of this paper will help the shadow banks and the supervisors to identify the financing dependence and risk spillover effect of the small and medium-sized enterprises on the different types of shadow banks.It is helpful to alleviate the financing constraints of small and medium-sized enterprises and support the development of the real economy of our country by vigorously supporting the financial institutions which the financing of SMEs depending on greatly under the premise of controlling risks.