Research On The Impact Of Financial Opening On Bank Systemic Risk

In 2017,the central government held the fifth financial work conference,which clearly stated that it is necessary to actively prevent and resolve systemic financial risks.In this context,expanding financial opening is not only an inherent requirement to promote the development of the banking industry to achieve high-quality economic growth,but also brings a arduous task to dealing with banking systemic risks and maintaining my country’s financial security.This paper attempts to clarify the relationship between financial opening and banking system risks and expected to provide reference for related research.This paper firstly reviews the process of China’s financial opening and in-depth analysis of the international banking crisis cases,and summarizes the experience and lessons for preventing banking systemic risks in the process of my country’s financial opening.Then,based on the theory of financial liberalization,the interest group theory of financial development,the theory of financial crisis and the theory of financial asset price fluctuations,this paper takes 14 A-share listed banks from 2008 to 2020 as a sample to investigate the impact of my country’s financial opening on the systemic risk of banks.The research results show that the increase in the level of financial openness will lead to an increase in the systemic risk of banks,and has a greater impact on stateowned banks.The conclusion is still valid after using the instrumental variable method and the GMM method to deal with the endogenous problem.From the micro level of banks,indicators such as capital adequacy ratio,non-performing loan ratio and loanto-deposit ratio are significantly correlated with bank systemic risk.As far as the transmission mechanism is concerned,it is verified that financial opening affects the systemic risk of banks through a competitive mechanism channel that reduces bank interest spread and a capital allocation mechanism channel that exacerbates short-term cross-border capital flows.The research conclusions of this paper on the impact of financial opening on the systemic risk of banks have enriched the research framework in the field of bank risk management under the background of financial opening,and provided thinking and reference for my country to improve relevant policies of financial opening and the development and reform of the banking industry.Stability and even financial security also have far-reaching practical significance and important enlightenment.Finally,in view of the fierce competition,declining interest income and asset price fluctuations brought about by financial opening to the banking industry,policy recommendations such as implementing institutional financial opening policies,encouraging banks to diversify operations and strengthening prudent management of short-term cross-border capital flows are put forward.