The Impact Of Liability Structure On The Risk-taking Of Commercial Banks

With the macroeconomic slowdown,the acceleration of interest rate liberalization and the booming internet finance,the ratio of commercial banks’ deposit liabilities gradually decrease.However,the ratio of interbank liabilities to total liabilities and NCDs to total liabilities gradually increase.This change has affected the configuration and management of assets and liabilities of commercial banks,changed the operating behaviors and risk-taking levels of commercial banks,and even played a role in the stability of the financial system.A deeper understanding of the logical relationship between the debt structure of China’s commercial banks and their risk appetite is not only of great significance for improving the ability of banks to manage their assets and liabilities,but also for the future changes in the object,mechanism and pattern of financial regulation and the maintenance of the stability of the financial system significance.This article mainly analyzes the current situation of liability structure of commercial banks in China and studies the relationship between liability structure and risk-taking of commercial banks.The innovation of this paper is as follows:1,draw lessons from the theoretical model of predecessors and creatively put forward the mechanism;2,select the annual unbalanced panel data of 296 commercial banks in China from 2008 to 2016 and empirically analyze the influence of liability structure on commercial banks risk,and the sample size is large;3,on the basis of 296 commercial banks,this article selected the issuance of NCDs of 125 commercial banks as a sample to study the impact of NCDs on the risk-taking of commercial banks,making up the academic problem research deficiencies.Analysis of the status quo shows that commercial banks’ liabilities are dominated by deposits,but the proportion of inter-bank liabilities increases now.The composition of inter-bank deposits accounts for the largest proportion of inter-bank liabilities.Borrowed funds and repurchase agreements are similar proportions.The explosive growth of NCDs,is replacing some of inter-bank liabilities.Non-deposit liabilities are highly costly and volatile.The result of theoretical analysis shows that the impact of debt structure of commercial banks on its risk appetite mainly through the combination of improving the regulatory mechanism and chasing revenue mechanism.The empirical results show that the debt structure of China’s commercial banks will have a significant impact on their risk-taking.Among them,the proportion of banks’ liabilities is significantly negatively correlated with the level of risk-taking of commercial banks,especially large state-owned banks.Increasing the proportion of NCDs will significantly increase banks’ risk-weighted assets.Increasing the ratio of interbank liabilities and NCDs to total liabilities will also significantly increase banks’ risk-weighted assets,but the conclusions about NCDs may be affected by endogenous issues.Based on the above conclusions,this paper proposes that commercial banks should optimize the liability structure.Supervisors should establish new concepts of regulation.