Empirical Analysis On Corporate Governance And Risk Taking Behavior Of City Commercial Banks

In recent years,the proportion of total assets and total liabilities of urban commercial banks in the whole financial institutions has been continuously rising,indicating its increasing importance in promoting the operation of the whole financial market.However,at the same time,Baoshang Bank incident and Jinzhou Bank incident have also sounded the alarm bell for urban commercial banks.After a multi-party investigation,the evil backstage manipulator which led to the bankruptcy of Baoshang Bank is the Mingtian Group.The group controlled Baoshang Bank through the method of multi-level network holding,and then embezzled bank funds through connected transaction.As a result,the operation of Baoshang Bank is difficult and even bankrupt.At the same time,it also reveals the problems of corporate governance in equity structure,characteristics of the board of directors,governance of the board of supervisors and executive incentives,which may lead to the increase of asset risks,loan risks and operational management risks undertaken by the bank.Therefore,this paper studies the relationship between corporate governance and risk-taking behavior of urban commercial banks.This article selected 72 banks with relatively complete data as the research sample from 133 urban commercial banks,collected the annual report data from 2015 to 2019,and constructed the fixed effects model.In the selection of indicators,this paper uses the proportion of risky assets to measure the asset risk,the non-performing loan ratio to measure the loan risk and the bank risk composite index to measure the operation and management risk.Through empirical analysis,the paper discusses the influence of equity concentration,the proportion of independent directors,the scale of the board of supervisors,and the cash incentive of senior executives on the asset risk,loan risk and operation and management risk of banks.Finally,this paper believes that we can improve the governance mechanism of urban commercial banks from the following four aspects:1)Introduction of strategic investors;2)Strengthen the infoRWAtion transparency of city business firms;3)Play the supervisory role of the Board of Supervisors;4)Explore ways to introduce and retain senior executives in city firms.