| Since the birth of banks,deposit safety and bank risks have always accompanied the development of banks.The deposit insurance system,the macro-prudential supervision of the financial supervisory authority,and the central bank's lender of last resort system together formed the financial safety net.They are considered the most effective means for modern countries to maintain financial stability.Deposit insurance refers to the establishment of an insurance institution by the government or various banking institutions.Each bank,as an insurance applicant,pays insurance premiums to the deposit insurance institution and establishes a deposit insurance reserve.When the insured bank experiences a crisis or bankruptcy,deposits insurance institutions provide them with financial assistance or directly pay some or all of their deposits to depositors,thereby protecting the interests of depositors,maintaining bank credit,and stabilizing financial order.The deposit insurance system began in the United States in the 1930s.Since the 1960s,the development of the financial industry has become increasingly liberalized and globalized,and financial risks have increased significantly.Many countries have followed the United States and began to establish explicit deposit insurance systems.More than one hundred countries and regions have established deposit insurance systems.In 1993,China put forward the idea of establishing an explicit deposit insurance system.In the following two decades,relevant departments and researchers have conducted a lot of research on China's implementation of explicit deposit insurance.After a long period of demonstration and preparation,China officially implemented the deposit insurance system on May 1,2015.This article focuses on the institutional change from implicit deposit insurance to explicit deposit insurance,and conducts the following research on my country's deposit insurance system:(1)Analysis of China's deposit insurance systemIn this part of the research,this article first discusses the necessity of China's implicit deposit insurance Discuss the nature and limitations of the insurance system,and then analyze the necessity of implementing explicit deposit insurance in China and the mechanism design of the current deposit insurance system.Discuss the role of explicit deposit insurance in protecting depositors,restraining bank risks,and creating a fair banking industry.(2)The impact of the reform of the deposit insurance system on the systemic risks of banksThe implementation of deposit insurance regulates bank operations through multiple clauses such as limit insurance and risk adjustment rates,in order to reduce bank risks and maintain the stability of the financial system.Therefore,this article conducts an empirical test on a sample of 16 listed banks in China from 2006 to 2018,examines the impact of the output system reform on the systemic risks of the banking industry,and finds that in the process of transforming implicit deposit insurance into explicit deposit insurance,systemic risks in the banking industry have been effectively suppressed.After grouping the banks,it is found that banks with higher deposits and loans ratio have significantly reduced systemic risk after the implementation of explicit deposit insurance.This article proves the robustness of the empirical results through a series of robustness tests,and believes that the deposit insurance system has played a preliminary role in reducing systemic risks in the banking industry.(3)The micro-impact of the reform of the deposit insurance system on banksPrevious research on deposit insurance focused on the impact of the system on banks' risk-taking.However,the micro-impact of the deposit insurance system on banks is probably not limited to risk-taking.Therefore,this article expanded the research on the micro-impact of banks.After studying the micro-data of 166 commercial banks in China,it is found that the reform of the deposit insurance system has reduced the bank's risk exposure,increased asset liquidity,increased financing costs,and increased the level of non-interest business.It shows that deposit insurance has achieved initial results in reducing bank risks,but after no longer enjoying state implicit guarantees,commercial banks will face increased competition pressure and need to improve risk management capabilities,optimize asset-liability structure,and enhance multi-channel profitability.(4)The impact of the reform of the deposit insurance system on the creation of bank liquidity.Liquidity creation ability is a reference for measuring whether banks can play the role of financial intermediary.However,when Chinese researchers currently calculate the level of liquidity creation,the difference in database accounting often leads to inconsistencies in the calculation results of liquidity creation and affects the reliability of liquidity creation research.This paper matches and integrates the statements of different databases to ensure the consistency and comparability of the results of calculation of liquidity creation using different databases.On this basis,this article found through empirical testing that the institutional reform of deposit insurance has inhibited liquidity creation through bank risk-taking,asset liquidity,financing costs,and non-interest business levels,which is not conducive to banks' intermediary functions.Departments should join differentiated regulatory policies for deposit insurance for different types of banks to ensure that small and medium-sized banks serve the real economy.The main conclusions are:(1)The implementation of implicit deposit insurance in China has defects.The implicit deposit insurance has played a role in protecting depositors and problem banks during the transformation of China's banking industry,but it has also caused a series of problems such as moral hazard.Compared with implicit deposit insurance,explicit deposit insurance has more advantages.It plays a prominent role in reducing the moral hazard of participating banks and enhancing the role of market restraint.It is a suitable choice for the development of China 's current banking industry.(2)China's explicit deposit insurance is an institutional breakthrough to reduce systemic risks in the banking industry.Through empirical research on listed banks in China,it is found that the implementation of explicit deposit insurance has a positive effect on restraining systemic risks in the banking industry.(3)The implementation of explicit deposit insurance in China will have a series of microimpacts on banks.Through empirical analysis of bank micro-data,this article finds that the institutional reform from implicit deposit insurance to explicit deposit insurance in China reduces the risk taking and improved the asset liquidity,financing costs and noninterest business level of banks.It is said that the implementation of explicit deposit insurance will help reduce individual bank risks,but at the same time it will increase the difficulty of bank operations.(4)Liquidity creation is the basic function of commercial banks.Further research in this paper finds that the implementation of explicit deposit insurance in China inhibits bank liquidity through micro changes in bank risk-taking,asset liquidity,financing costs,and non-interest business levels,indicating that there is still room for optimization in the current deposit insurance system.The main innovations of this article are as follows:(1)Based on previous research results on deposit insurance,analyze China's deposit insurance system from a theoretical perspective,and combine bank data to demonstrate the role of explicit deposit insurance in suppressing systemic risks in the banking industry.The research has enriched the literature on deposit insurance research in emerging market countries.(2)Previous studies on the micro-impact of deposit insurance on banks focused on bank risk-taking.This article expands on this,examining the micro-impact from bank risktaking,asset liquidity,financing costs,and non-interest business level.The microimpact of deposit insurance on Chinese banks helps researchers understand the microeffect of the deposit insurance system on banks.(3)Liquidity creation is the basic function of commercial banks.From the perspective of liquidity creation,this article examines how deposit insurance affects the mechanism of liquidity creation through bank micro-variables,and provides a new perspective and basis for evaluating and improving the current deposit insurance system.(4)Liquidity creation,as an important indicator to measure the role of banks'financial intermediaries,has been a hot field of banking research in recent years,but its calculation results are different due to differences in domestic and foreign accounting standards and database subjects,resulting in inconsistent results of liquidity creation.This article tried combing domestic and foreign database subjects and can help researchers to obtain more consistent liquidity creation calculation results when using different databases and accounting standards,and provide help for research in this field.The research significance of this article lies in:(1)From a theoretical perspective,the research significance of this article is reflected in the following three aspects:First,developed countries have successively implemented deposit insurance systems in the last century,but the global economy and the financial systems of various countries are different.This article is based on China.The theoretical analysis of the development process of the banking industry on China's deposit insurance provides a basis for the study of China's deposit insurance.The empirical study on the systemic risks of deposit insurance in the banking industry provides a reference for the study of the effect of deposit insurance in emerging market countries.Secondly,this article expands the research channel of the micro-impact of deposit insurance on banks,this article has enriched the research results in this field on the impact of deposit insurance on bank risk-taking,asset liquidity,financing cost and non-interest business level.Finally,the perspective of liquidity creation in this article provides a new research perspective for measuring the role of deposit insurance.(2)From a practical perspective,first of all,China's deposit insurance system has been implemented for more than five years.This article's inspection of the current deposit insurance system in suppressing banking risks has proved the staged effectiveness of China's deposit insurance system;secondly,this article is combing and integration of the indicators of liquidity creation,which can help researchers in this field to obtain accurate and comparable indicators of liquidity creation.Finally,this article measures the effect of the deposit insurance system from the perspective of liquidity creation,which is important to help optimizing China's deposit insurance system and leading finance industry serves the real economy. |
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