Research On The Moral Hazard Control Of City Commercial Banks Based On The Threshold Regression Model

City commercial bank is an important part of the banking system in our country.Now it will face greater risks,because the rapid development of banking has ended,and the government has gradually reduced the implicit guarantee of banks.In order to facilitate self-development,city commercial banks must control the moral hazard.Based on the theoretical study,our paper attempts to establish a threshold regression model to analyze the data of city commercial banks.Our results will help regulators to better supervise the city commercial banks and city commercial banks to develop healthy.Firstly,our paper summarizes the research of the moral hazard of city commercial banks at home and abroad.At the result of this,we find that domestic researches mainly focus on theoretical research and lack of empirical research.This shows that there is room for research.Secondly,we discuss the theory of moral hazard and analysis of the reasons for the moral hazard of city commercial Banks.To introduce threshold regression model,we explain the scope of application and the operation steps.Finally,our paper will use the threshold regression model to analyze the data of city commercial banks.We select the data of 60 city commercial banks from 2007 to 2015,and choose the non-performing loan rate as the threshold variable.The results show that there is threshold effect in the operation of city commercial banks.When the city commercial banks operate in good condition(non-performing loan rate below the threshold),the bank manager does not show moral hazard in the loan.However,when the situation worsens,the bank manager will have moral hazard and this moral hazard will worsen with the further deterioration of the bank’s operating conditions.We hope the results would provide some reference for the supervision and promote the healthy development of city commercial banks.