Research Of The Impact Of Banking Industry Competition On The Bank Lending Channel In China

With the deepening of economic monetization,the means of our country’s monetary policy from the beginning of the direct administrative intervention into indirect tool control, but the actual effect of monetary policy implementation is affected by many factors, from the central bank’s monetary policy formulation, through the conduction of financial intermediation, ultimately affect the economic behavior of enterprises and residents. The behavior of these market players in the transmission of monetary policy will have an impact on the effect of monetary policy. The characteristics of China’s financial structure determines the important role of bank lending channel in the transmission of monetary policy,and the change of the competition of the banking market will have an impact on the transmission of monetary policy. To study the influence of the degree of competition in the banking industry on the transmission of monetary policy becomes urgent. Based on this background, this paper attempts to further study the impact of China’s banking industry competition on bank lending channel from theoretical and empirical point of view.This paper first analyzes the mechanism of the effect of the bank competition on the bank lending channel. Then combined with the current situation of China’s banking industry, the corresponding hypothesis is put forward, and then the corresponding empirical model is established. Based on the sample data of China’s listed banks in 2003-2014, the paper has verified the hypothesis of the paper. The results show that the strengthening of the bank’s competition is not to weaken the effect of the bank lending channel, but the strengthening effect. Starting from the two existing conditions of the bank credit channel, the analysis found that with the increase of the degree of competition in the banking industry, for banks, the elasticity of non-loan assets and loan assets in bank balance sheets has become weaker. For the enterprise, the bank competition makes bank credit financing become more important in the enterprise financing. Finally, this paper gives the following policy implications from the perspective of financial structure upgrading: First, to improve the competition of the banking industry, to promote the healthy growth of the banking industry, and to build a good environment for the healthy growth of the banking industry, which is beneficial to improve the transmission efficiency of the monetary policy.Second,by changing the concentration of the banking industry, and then to the banking industry’s degree of competition. Competitive banking structure is conducive to enhancing the level of competition among banks, which can improve the management level and the allocation efficiency of financial resources. Third, support small and medium banks, support small and medium enterprises, for the conduction of bank lending channel to establish more "capillary", for the relief of small and medium enterprises "loan difficult" problem has some positive significance. Fourth, promote the development of capital and corporate bond market, on the one hand, through the capital market, the monetary policy signal is transmitted to the various subjects in the economy, on the other hand, it can also reduce the dependence on bank loans, forced the banking industry to optimize the operation, improve the efficiency and the ability to resist risks, promote the transmission of monetary policy.