Studies On The Impact Of Fluctuation Of Real Estate Price On The Stability Of Banking System

In recent years, along with real estate prices continue to rise, and more loomingreal estate bubble is an indisputable fact that, especially the outbreak of the U.S.subprime mortgage crisis in2007sounded the alarm that the volatility of real estateprices is apt to cause the financial crisis, which for our mainly rely on bank credit tosupport real estate market, but also to pay attention to the impact of falling houseprices and the risk may bring stability to the banking system to prevent disturbing thesteady pace of China’s financial markets and economic development. In addition, thisyear, many different degrees of decline in house prices, and the emergence of somephenomenon " off for abandoned room" Therefore, research has practical significanceof real estate price fluctuations affect the stability of our banking system.From the theoretical analysis of price fluctuations through the credit channel,market mechanisms and non-interest channels conducting various risks to the bankingsystem, in the empirical analysis, the combination of both the real estate market andthe banking industry increasingly linked the status quo, from the banking systemcredit risk, market risk and foreign exchange risk may face angle to select the sevenindicators: bank deposits (CK), savings deposits/M2(CX), bank loans to thenon-governmental sector (FZF), non-performing loan ratio (BLD), credit growth rate(XDZ), loan/deposit (CDB) and the net foreign assets of banks (GWZ), the use offactor analysis and synthesis index measure out the banking system stability index,establish VAR model price fluctuations affect the stability of the system and ourbanks dynamic analysis of long-term relationships, we know there is a correlationbetween the real estate price fluctuations affect the stability of the banking system, theresults from the analysis of the relationship, and the initial price volatility of realestate on the stability of the banking system and have a positive effect, is notconducive to long-term stability of the banking system, and with the passage of timethe extent of the impact will be gradually reduced, and the impact on the stability ofthe banking system arising from price fluctuations are mainly conduction throughbank credit. With the opening of China’s capital market and the opening up of thebanking sector to increase, it may increase the risk of price fluctuations faced by theinternational banking system, short-term capital flows, such as multi-channel.Therefore, we need the real estate financial market system and strengthen the bankingsystem of internal risk control three-pronged approach to effectively reduce the adverse effects from improved external environment, a sound system of pricefluctuations on the stability of China’s banking brings.