An Empirical Analysis Of The Impact Of Banking Competition On Relational Financing

Along with the development of our economy, small and medium-sized enterprises develop rapidly taking up a great proportion in all enterprises, with more than sixty percent of GDP. As the important economic subject, its difficult financing brings an effect on the national economic growth, employment and even social stability. Small and medium-sized enterprises are at the early stage of enterprise development with the small scale, big volatility, incomplete information disclosure and other characteristics, so they cannot meet the needs of working capital due to its difficult financing, which affects the daily operation and enterprise survival. According to the survey, the difficult financing exists not only in China, but also in the world with a great influence on the economic development, so the problem solving has become an important research topic in the field of economy. The relationship lending is put forward by scholars at home and abroad in order to resolve the difficult financing, which is different from the traditional trade financing, establishing a long-term business relationship with banks, and it transforms the non-public soft information into the proprietary information through the bank-enterprise relationship for the future rent. The theory of the relationship lending is applied to the financing in small and medium-sized enterprises. And the relationship lending model is beneficial to solve the difficult financing caused by the asymmetric information, high management risk, lacking regulation, insufficient capital demand, high frequency etc., which is showed by many studies at home and abroad.Throughout the development history of relationship lending theories, the influence factors include the banking competition, bank scale, regional economic development, political association, policy orientation, etc. This paper emphatically studies the impact of banking competition on the relationship lending, which includes the theory basis of relationship lending; the mechanism study of banking competition influences on relationship lending; the present situation analysis of relationship lending in China; the empirical research of the functional mechanism between banking competition and relationship lending; corresponding suggestions aiming at research results.Taking the promotion of healthy two-way development in small and medium-sized enterprises and banks, the expansion of financing channels of small and medium-sized enterprises and the optimization of bank credit market as the principle and target, this paper deeply analyzes related theories of the relationship lending, and analyzes the relationship lending cost, income and substitution effect from the perspective of banks and enterprises, and deduces the influence and functional mechanism of banking competition on the relationship lending, and finally puts forward the hypothesis with the empirical test for the conclusion and corresponding suggestions. Based on the above research, this paper analyzes related theories and puts forwards the hypothesis that there is a negative linear correlation between the banking competition degree and the relationship lending access, with the combination of qualitative and quantitative research. And this paper verifies the hypothesis through the panel data regression and reaches a conclusion, taking the relationship lending of 136 small and medium enterprise board listed companies from 2010 to 2014 as sample data.According to the empirical test, there is a negative linear correlation between the banking competition degree and the relationship lending access. The intense banking competition will lead to the decreased overall banking earnings, unstable banking relationship and the increased enterprise bargaining ability, which will reduce the possibility that the perfect soft information and expected high rent are obtained by banks, so the bank will increase the traditional transactional lending and decrease the relationship lending. Based on the research results and the actual development situation of small and medium-sized enterprises in our country, this paper puts forward corresponding suggestions. The healthy bank-enterprise relationship should be guided to establish and maintain properly in the transition process from the high concentration to competitiveness for the banking market; and the credit and guarantee system should be perfected to standardize the information disclosure, which can prevent the incomplete information disclosure from the hindered relationship lending access; in addition, the banking market orientation should be kept, and the capital market should be developed actively with a positive policy guidance, which will transform the banking market to favorable competitive market, and develop good functions of credit market competition to deal with the difficult financing for the optimal allocation of credit funds in the benign competition market...