Research On The Impact Of China's Shadow Bank Scale On The Stability Of Commercial Bank System

As an important product of financial innovation,“shadow banking” has been developing at an alarming rate in recent years,so that it has developed into a huge scale.Therefore,in the financial field,shadow banking has become powerful force that cannot be ignored.Moreover,the reason why shadow banking is called "banking" is that it is inextricably linked with commercial banks.On the one hand,the development of shadow banking has greatly promoted the operation mode and the profit model of commercial banks so that the income level of commercial banks can be greatly improved;on the other hand,shadow banking have some defects that weaken the value of the credit intermediation and thus the systemic risks in the financial market are amplified.These shortcomings of shadow banking include maturity mismatch,credit conversion,liquidity conversion and high leverage.The ultimate goal of this paper is that after analyzing the effect of shadow banking on the stability of the system of commercial banks,obtain the specific results through empirical analysis and analyze possible and reasonable reasons for this result,so as to correctly understand the existence of shadow banking,see its development objectively,give full role to its complementary functions to the traditional commercial banking business and strengthen the reasonable and appropriate supervision to it and improve the level of financial innovation of China.It provides a certain theoretical and practical basis.The research of this paper first introduces some relevant backgrounds about shadow banking and some related literatures are summarized.Then it analyzes the mechanism of the impact of shadow banking on the stability of the commercial banking system.In this part,it is mainly divided into four aspects: capital finance,risk transmission,currency circulation and supervision & management.Then this paper measures the size of the shadow banking and measures the stability of the commercial banking system.For the former,the previous research results are summarized,and based on the actual situation in China,the scope of the shadow banking required by this paper is defined.The endogenous shadow banking,which is generated from within the commercial bank,mainly includes entrusted loans and banks,interbank borrowing and undiscounted bank acceptance bills;exogenous shadow banking,which is formed outside commercial banks,mainly includes microfinance and P2 P lending.Then according to this scope,the specific size of the shadow banking is obtained by collecting data.For the latter,the first is to build an indicator system,which includes macroeconomics,market operation,commercial banking institutions,and then collect data and then obtain certain calculation results.With the shadow banking scale and the stability index of the commercial banking system,this paper builds a polynomial regression model based on this empirical analysis.This regression model uses the stability index as the explained variable,with relative shadow banking size and other related variables as explanatory variables.The point to be emphasized here is that the relative shadow bank size which is the shadow bank size/GDP,is used because it can eliminate the impact of economic development on the size of shadow banking.The main conclusion obtained in the empirical analysis is that there is a threshold effect on the impact of the relative shadow banking size on the stability of the commercial banking system.When the size of the shadow banking is less than a certain threshold,it will increase,and the stability of the commercial banking system will be lower.When the scale is larger than this threshold,the stability will increase.Based on the above results,this paper summarizes the following conclusions: First,the development of China's shadow banking is still not perfect,and it is still in its infancy.However,affected by the rapid economic development,the demand for investment of Chinese people and enterprises is growing stronger.Commercial banks want to pursue a greater source of profit.China's financial structure needs to be more perfect to adapt to economic development.Therefore,China's shadow banking can be quickly develop and play an increasingly important role.Second,because of the absolute advantage in the scale of shadow banking,the shadow banking business closely relates to traditional commercial banks,namely endogenous shadow banking,which has a greater impact on the commercial banking system.Third,although the development of shadow banking can play a certain complementary function to the commercial banking business and promote the development of the real economy to a certain extent,from a long-term perspective,the risks of shadow banking may still erupt at any time.