The Influence Of Local Government Intervention On The Non-performing Loan Ration Of City Commercial Banks

The special equity structure –the local government’s “a single large” which formed in the beginning formation of City Commercial Bank,make a special relationship between the bank and local government formed. As the main institutions to promote regional economic growth and to maintain social stability, the local government has a strong incentive to intervene in the economic development and resource allocation of the area which in the jurisdiction of itself. In this case,it is very necessary to analyze and study the influence of local government intervention on city commercial banks. Taking into the non-performing loan ration is one of the important indicators to measure the development of the kinking industry,and the government is mainly through the influence of city commercial bank credit to achieve the city firm’s intervention. So the article analyzes the influence of government intervention on the non-performing loan ration of city commercial banks.Herein,this paper refers to the relevant research of scholars at home and abroad,the analysis of the influence of local government on the non-performing loan rate of city commercial banks from the perspective of theory,current situation and empirical analysis. This article selects a total of 15 banks,including the Tianjin Bank,the Bank of Hebei and so on.2009-2014 date for six consecutive years as the observation value. Select fiscal expenditure accounts for GDP、the proportion of investment accounted for the proportion and fiscal expenditure deficit ratio as the explanatory variable. and so on. Non-performing loan ratio and proportion of state-owned shareholders as the variable be interpreted. The result shows that local government intervention will affect the city firm’s non-performing loan ration,but different variable have different effects. Public and administrative loans、the fiscal deficit rate and the share proportion of government have a significant negative effect on non-performing loans;State-owned investment and proportion of state-owned shareholders have a positive effect on nonperforming loans;Fiscal expenditure to GDP have no significant effect on non-performing loans of City Commercial Banks. Through the dynamic analysis,indicators fiscal expenditure accounts for GDP 、 the proportion of investment accounted for the proportion、public and administrative loans and the fiscal deficit rate has the lag effect,and the lag phase is more obvious. Results from the regional analysis,the eastern、central and western is different,mainly in the indicators public and administrative loans and the fiscal deficit.Under the new situation,the external environment faced by the banking industry has been greatly changed, including the continuous impact of rapid development, the interest rate market of internet banking and financial disintermediation intensified. The banking industry,including city commercial banks,need to speed up the transformation to adapt the increasingly severe external environment. City Commercial Banks should properly handle the relationship with the local government in the prerequisite of risk can be controlled,and give full play to their own advantages to promote the development of local economy; local government should actively change their functions to make the city commercial bank into the real sense of the autonomy of the bank;Besides, also need to give full play to the regulatory role of the Banking Regulatory Commission.