Title: Involuntary Excess Reserves,Monetary Policy and Bank's Risk-Taking
Abstract: This paper uses the relevant data of 49 Chinese commercial banks from 2008 to 2013 to explore the relationship among bank's involuntary excess reserves,monetary policy stance,and bank' s risk-taking through building dynamic panel model. The empirical research shows the increasing of bank's involuntary excess reserves ratio will promote bank risk-taking related to loan,but will also reduce bank risk-taking associated with asset allocation; the effect of bank's involuntary excess reserves ratio on bank's risk-taking will be affected by monetary policy,the easing monetary policy could significantly inhibit the positive influence of bank's involuntary excess reserves on bank's risk-taking related to loans,but will promote the negative effect of voluntary excess reserves on bank's risk-taking associated with asset allocation. Therefore,in order to prevent bank risk accumulation and make economy running smoothly,regulatory authorities should actively monitor bank's involuntary excess reserves and be prudent on fine-tuning operating about it.
Publication Year: 2015
Publication Date: 2015-01-01
Language: en
Type: article
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