Search

The Influence of Interest Rate Liberalization Reform on Credit Risk of Commercial Bank

Author(s)

Linchun Han*

Affiliation(s)

Business College, Southwest Minzu University, Shuangliu, Chengdu, China *Corresponding Author.

Abstract

The resource allocation function of interest rate liberalization plays an important role in the optimization of the national financial market, which is conducive to the more effective flow of capital to projects with higher production efficiency, and thus has a significant impact on China's financial institutions, especially commercial banks. However, with the deepening of interest rate liberalization reform, the credit risks faced by commercial banks have become more complex and changeable, which is not only detrimental to the development of banks themselves, but also has an impact on the stability of the entire financial system. Using the panel data model from 2010 to 2021, this paper selects 16 representative commercial banks in the three types of banks, takes net interest margin as the explanatory variable and non-performing loan ratio as the explained variable for empirical analysis, draws conclusions and puts forward countermeasures for the interest rate liberalization reform of Chinese commercial banks.

Keywords

Interest Rate Liberalization Reform; Commercial Banks; Credit Risk; Panel Data Model

References

[1]Zhao Ping, Fang Xia. Interest rate liberalization reform and banks' credit risk pricing ability: Based on the relationship between loan interest rate fluctuation and credit risk in China. Financial Forum,2022,27(08):19-28. [2]Jiang Shuxia, Liu Zhonglu. Is there any difference in the influence of deposit and loan market competition on bank risk taking? - based on the market-oriented interest rate reform in China to discuss. Journal of economic management, 2016, 38 (6): 1-15. [3]Zuo Xi. Pay attention to the improvement of operation and management ability to adapt to the market-oriented reform of deposit interest rate. Financial Times, 202401-05(003). [4]ZHANG Peizong. Practice of deepening interest rate liberalization reform in rural commercial banks. China Money Market, 2023(12):38-42. [5]Li Mingyao. Research on credit risk Management of commercial banks under the condition of interest rate liberalization. Nanchang to learn: 2019. [6]Xu C. The impact of interest rate liberalization on the credit risk of commercial banks. Finance and Accounting Learning, 2019(10):203+205. [7]Chen Xiaochen. Analysis of the impact of interest rate liberalization Impact on credit risk of commercial banks based on KMV model. Journal of Commerce, 2016(01): 193-194. [8]Wu Yanfei, Song Yang, Chen Xiaorong. Discussion on the impact of interest rate liberalization reform on the interest rate risk management of commercial banks. Modern Economic Information, 2015(10): 346-347. [9]Long Yaqing. The influence of interest rate marketization on the credit risk of commercial banks. Modern Commerce, 2015 (18): 156157. [10]Wang Ruilin. The present situation and strategy of interest rate risk management of commercial banks in China. Henan Finance and Taxation College Science News, 2010, 24 (01): 33-35. [11]Zhang Qisheng, Xu Jiayin. On interest rate risk Management of Commercial Banks in China. New Finance, 2003 (04): 2-4. [12]Takahashi. Current situation and management analysis of interest rate risk in commercial banks. Economist, 2006 (04): 234-236. [13]Qi Fengjun, Wang Jinghui. On the influence of interest rate marketization reform on China's commercial banks and its countermeasures. Contemporary Finance, 2013 (32): 166. [14]Song Han. The influence of interest rate marketization reform on China's commercial banks and risk prevention. Qufu normal University, 2015. [15]Zhao Ziyi, Yang Xiaopeng. Comparative Analysis on the degree of marketization of loan interest rate between Chinese and American Commercial Banks. Southern Jinrong, 2011 (01): 46-49-78.