Author(s)

Xiaolong Hua ¹, Mao Wu ¹

Affiliation(s)

¹ School of Finance, Inner Mongolia University of Finance and Economics, 185 North Second Ring Road, Hohhot, China

Corresponding Author

Xiaolong Hua

ABSTRACT

In recent years, emerging interbank business has become the main means for banks to make profits. This paper uses buy-back and sell-back to measure the emerging interbank business, analyzes the impact channels of the emerging interbank business, selects the annual data of 157 Chinese commercial banks from 2012 to 2021, establishes a dynamic unbalanced panel regression model, and empirically analyzes the relationship between emerging interbank business and bank risk-taking. The results show that the expansion of emerging interbank business significantly increases bank risk-taking. It is suggested to revitalize the stock of interbank business, strictly control the increment, improve the risk weight coefficient of interbank business, and enrich the regulatory system.

KEYWORDS

Emerging interbank business, Buy-back, Sell repurchase, Bank risk-taking

CITE THIS PAPER

Xiaolong Hua, Mao Wu, An Empirical Study on Emerging Interbank Business and Risk-Taking in China. Financial Engineering and Risk Management (2023) Vol. 6: 42-47. DOI: http://dx.doi.org/10.23977/ferm.2023.060406.

REFERENCES

[1] Xu Y. (2014). An Interbank Perspective on Interbank Liquidity. Chinese Finance, (8), 23-24. 
[2] Li X. (2019). Research on the Impact of Bank Market Power on Liquidity Mismatch: A Literature Review. Study of International Finance, (12), 1-14.
[3] Schnabel I., & Shin H. S. (2004). Liquidity and Contagion: The Crisis of 1763. Journal of the European Economic Association, 2(6), 929-968.
[4] Zhu J., Li Y., & Zhang Y. (2016). Influencing Factors and Economic Consequences of Commercial Banks Engaging in Shadow Banking: An Empirical Study on the Financiers of Shadow Banking System. Financial Research, (1), 66-82.
[5] Acharya V., & Naqvi H. (2012). The Seeds of a Crisis: A Theory of Banking Liquidity and Risk Taking over the Business Cycle. Journal of Financial Economics, 106(2), 349-366.

Sponsors, Associates, and Links

---

• Information Systems and Economics
  
  
• Accounting, Auditing and Finance
  
  
• Industrial Engineering and Innovation Management
  
  
• Tourism Management and Technology Economy
  
  
• Journal of Computational and Financial Econometrics
  
  
• Accounting and Corporate Management
  
  
• Social Security and Administration Management
  
  
• Population, Resources & Environmental Economics
  
  
• Statistics & Quantitative Economics
  
  
• Agricultural & Forestry Economics and Management
  
  
• Social Medicine and Health Management
  
  
• Land Resource Management
  
  
• Information, Library and Archival Science
  
  
• Journal of Human Resource Development
  
  
• Manufacturing and Service Operations Management
  
  
• Operational Research and Cybernetics