A Study On The China’s Shadow Banking

A world financial crisis in2008takes the shadow banking to the people’s eyes.Countries are beginning to pay attention to and study the shadow banking. A seriousprivate lending crisis occurred in Wenzhou China in2011， after which many financialproducts and trust services are Unable to honor. In result the shadow banking in Chinawent to the cusp. Academics and politicians hold a heated debate about it.Under the big background, We learn from the current basis for further study of onthe shadow banking at home and abroad. First of all we explore the existence problem ofshadow banking in our country. We find that the shadow Banking of our country indeedexist, but have a great difference to the abroad shadow Banking. Followed we defined theshadow Banking of our country, described the development of the shadow Banking of ourcountry in the current. We also introduced some typical shadow banking businesse s in ourcountry. In addition we provide two kinds of method to estimate the scale of the shadowBanking of our country, in order to prove the development of the shadow banking of ourcountry.Then based on discussing the development of shadow banking in China，we explorethe challenges and opportunities it brings to China. The main opportunities are as follows.It can increase the real economy financing channels; can make up for the funding gap andpromote economic growth; can ease the credit market information asymmetry; canencourage financial innovation; can improve liquidity in financial markets, can speed upthe process of marketization of financial markets. The main challenges are that the shadowbanking implied high risk, which brought a greater challenge to monitor and regulate. Itcan hedge the effectiveness of monetary policy which challenges the macroeconomicregulation. It can threaten the real economy development, and challenges the economictransformation of our country.Finally we discussed what appropriate measures we can do to address theseopportunities and challenges, so as to provide some suggestions to regulate and perfect theshadow banking system in China.