The Research Of The Impact Of Interest Rate On Bank Risk-Taking

Since the financial crisis that outbreak in the United States in 2008 spread to the global, the causes of the financial crisis became an important topic in the field of finance scholars, not only the lack of financial supervision is considered to be an important factor in the crisis, at the same time, a long period of low interest rate policy is also questioned. Some scholars believe that the continued low interest rates will increase the value of bank assets and the value of the collateral, excessive credit expansion, the leverage of financial institutions increases, lead to increased risk taking of banks, and resulting in the excessive accumulation of financial system risk, and eventually the financial crisis broke out. So will low interest rates lead to, and how to lead to the risk of banks increases, and what is the relationship between interest rates, bank risk taking and financial stability has become the focus of attention of the scholars.This paper discusses the relationship between interest rate and bank risk-taking from theoretical analysis and empirical research this two aspects. In the theoretical analysis part, based on the research of scholars at home and abroad, mainly elaborates the four influencing mechanism of interest rate risk to the bank risk-taking, namely valuation mechanism, profit mechanism, inertia and reaction mechanism, and influence factors, and use it as the basis for empirical research. In the empirical study, through the use of quarterly panel data in 2008-2014 of China listed commercial banks, respectively construct the fixed effect model, and choose expected default rate and non-performing loan ratio as bank risk-taking proxy variable, and as spread term to the proxy variable of interest rate policy. With expected default rate as bank risk-taking proxy variable, it select economic growth rate, the real estate boom index, market concentration degree, stock index volatility and return rate curve slope as the macro level control variables, and bank size, capital adequacy ratio, current ratio and net interest margin as the bank level selection. It select economic growth rate, market concentration degree and important degree as the macro level control variables, and bank size, cost to income ratio, equity ratio, non-interest income ratio and asset profit rate as the bank level selection based on the rate of non-performing loans as bank risk-taking proxy variable.Through the fixed regression effect regression analysis, lagged 2-3 period spreads regression analysis and regression analysis of different types of bank to the tow fixed effects models, obtain the empirical conclusions that it exists bank risk-taking channel in our country, interest rates influences bank risk-taking by evaluation mechanism, profit mechanism and inertia mechanism, different types bank` risk-taking has different response to interest rates, and the macro level and bank level variables have important influence to bank risk-taking channel. Therefore, based on the theoretical analysis and empirical results, this paper puts forward the following policy recommendations to promote the development of China's financial stability: perfect the monetary policy goals, accelerate reform the marketization of interest rate, promote the benign competition of banking system and strengthen reform of financial supervision regulation.