Research On The Impact Of Commodity Price Fluctuations On The Risk Assumption Of Commercial Banks

Commodities are essential to the development of the national economy,not only because they occupy an important position in the production of enterprises,but also because they are indispensable in the daily life of the people.With the rapid and vigorous development of China’s economy,the demand for bulk commodities has become increasingly strong,which has made the existing trade deficit larger and larger.Since the 1990 s,my country has accelerated to catch up with the developed countries,starting from nothing.The process not only made our people proud,but also shocked the world.The part of the bulk commodities consumed by China in the world’s total consumption showed a trend of accelerating growth.From the perspective of financial institutions represented by banks,focusing on the commodity trade financing business can not only seize market opportunities,but also help them to continuously improve risk control measures and enhance the level of independent innovation.However,from the current situation of my country’s financial market,commodities may be regarded as trade financing collaterals for traders to facilitate,expose or accumulate bank credit risks.This paper firstly conducts literature review and concept definition,expounds the risk-taking of bulk commodities and commercial banks in my country;Hypothetically,to explore the impact of commodity price fluctuations on commercial banks’ risk-taking.Based on the data samples of Chinese commercial banks from the first quarter of 2010 to the fourth quarter of 2020,this paper selects a multiple regression model to verify the relationship between domestic and foreign commodity price fluctuations and banks’ risk-taking.The three structural variables of bank balance sheet structure are set as threshold variables.From three different structural perspectives,the impact of commodity fluctuations on banks’ risk-taking impacts is analyzed.The empirical results find that both international commodity price fluctuations and domestic commodity price fluctuations will significantly increase banks’ risk-taking.Further research finds that,from the perspective of structural effects,when commodity prices change,the impact on commercial banks’ risk-taking is not linear,but there is a threshold effect.When the threshold indicator is greater than the threshold value,the impact of commodity price fluctuations on banks’ risk-taking will decrease.Based on the results of theoretical research and empirical analysis,this paper puts forward policy recommendations from three aspects: the government level,the financial institution level and the regulatory level,in order to help alleviate the risk-taking problem of commercial banks caused by commodity price fluctuations and promote the steady development of my country’s economy developing.