Empirical Study On The Vulnerability Of State-holding Commercial Banks

Financial crisis caused by the United States subprime mortgage crisis in thesummer2007, brought a terrible beating to the global economy. Analyzing thisfinancial crisis from its generating process, firstly, we can recognize that it is the banksystem influenced by many factors that creates increase of the fragilities, and then itevolves into the crisis of banks, global financial unrest further and finally makescatastrophe to the global economy. To some extent, the stable base of banking systemis unsubstantial, which is demonstrated by the global bank crisis happened frequentlyin these years.With the deepening of financial liberalization, bank’s risk will transmit from onecountry to another through the international transmission mechanism. As a dominantleader, China’s large state-owned commercial banks, their ability of identifying,preventing and controlling financial risks is very important to the stability of thewhole banking and financial systems. In this context, studying the vulnerability of ourcurrent state-owned commercial banks, discovering and solving problems have a greatpractical significance.This article first has carried on the review and the reorganization to overseas andthe domestic related literature, to the bank fragility, the financial fragility, the bankcrisis, the bank risk and so on related concept makes the explicit limits, and then it hascarried on the analysis to the bank system fragility production mechanism from theexogenous and endogenous perspective. Then the paper has carried on the thoroughanalysis to our country bank system fragility present situation and the influencingfactor. The core part of this article is selecting non-performing loan ratio, nationalloan growth ratio, inflation ratio and leverage to measure the vulnerability ofstate-holding commercial banks basing on the experience of the research achievementin the home and abroad, it has also collected samples data of1990-2009, usingJohansen Co-integration test and Granger causality test, to do empirical analysis onthe influencing factor indexes. Empirical results show that causal relationship existsbetween some macro-economic indicators, financial indicators and the vulnerabilityof state-holding commercial banks, while the financial indicators have higher impactthan the macro-economic indicators. In the end, this article proposes some policysuggestions from the macro level and micro level, including establishing a perfect andstandard financial market system, deepening the reform of the financial system and optimizing the market environment, establishing a sound social credit system,strengthening business innovation, accelerating the reform of property right system,strengthening the risk management of our country commercial banks and so on.