The Influence Of Banking Competition And Local Officials' Characteristics On The Agricultural Support Of The Rural Commercial Bank

Rural commerical Banks have become an important part of our financial system.However,due tovarious historical reasons,the development trajectory presebted by rural commecial banks is different from that five state-owned banks and the national joint-stock banks.Firstly,rural commerical banks have small asserts,high credit risk and vulnerable to external environmental changes.Therefore facing the increasingly fierce market competition rural commercial banks will be affected in the support of famers.Secondly,rural commecial banks as a typical local financial institutions,the business scope of the rural commercial generally is limited to prefecture level and even county-level cities,this means that the local government depends on mastering the economic resources exert a certain influence on the rural commercial bank.At the same time,when they have conflicts,the rural commerical bank have weak bargaining power.Third,the basic exit in state-owned Banks under the background of rural financial market,given the bank's advantage in agriculture and historical factors,the local government to by financial institutions to credit to support agriculture,rural commerical bank is preferred.This paper has combed and analyzed existing literature at home and abroad.Based on the u-shaped relation theory of competition and risk,information asymmetry theory and government intervention theory.This paper conducts an empirical analysis from the local bank market competition level and local officials' characteristics which are the two important factors-market and government-that affect agricultural and commercial bank support agriculture.Based on bank support agriculture there is contradiction with its commercial development,on the one hand,this paper analyzed the impact of market competition and local officials in the principle of bank support agriculture,on the other hand analyzed the bank market competition on the impact of bank support agriculture,and the local governments under different degree of competition in the market that only plays the role of the "visible hand".Based on the above analysis,empirical research is carried out based on non-equilibrium panel data of rural commercial Banks from 2010 to 2015:Firstly,we investigate the influence of bank competition on the agricultural support of the rural commercial bank.First,bank competition and agricultural loans shows aU-shaped relationship.Second,number of branches and agricultural loans shows a U-shaped relationship.Third,the above results have strong robustness in different samples.Four,bank competition and construction loans shows a inverted-U-shaped relationship.Secondly,this paper adopts the method of panel fixed effect model while controling the time effect,investigates the influence of official characteristics on the agricultural support of the rural commercial bank.The results show that under the jurisdiction of the different characteristics of the mayor,the rural commercial bank with different agricultural loans.First,from the perspective of professional knowledge,with science expertise within the mayor will significantly increase agricultural loans.Second,the characteristics of from the city on his tenure will significantly increase agricultural loans.Third,the size of the city GDP will weaken the impact of from the city.Four,the above regression results have strong robustness in the state-owned group.Finally,in order to further explore the interaction of bank competition in the market and the characteristics of local officials for the influence of the bank support agriculture,we joined the interaction of both,the results show that the social sciences major and HHI interaction coefficient is positive,that has social science specialized knowledge of the local officials to adjust the agricultural loans discrimination of rural commercial bank in area with low levels of competition in the market.The conclusion remained steady in the state-owned group.The interaction of whether from the city and HHI is no significant term coefficient,it means that the characteristics of from the city to the positive role of bank support agriculture has nothing to do with the degree of bank competition in the market.In addition to this,the higher the degree of share proportion of the largest shareholder will significantly increase agricultural loans in the state-owned group.And it's not significant in non-state groups.Combine the above empirical analysis conclusion,it is pointed out that we should strengthen the supervision of the banking industry and the guidance of rural commercial Banks while relaxing restrictions on access to banking to raise the level of competition in the banking market.