Research On The Impact Of Commercial Interbank Business On Bank Risk-taking Levels

The stability of commercil bank is so important which concerns whether the national economy can develop rapidly and ensure depositors' legal rights and interets.With the promotion of interest rate marketization and the continuous deepening of financial reform,the commercil bank can't gain profit by difference betwwen deposits and loans any more.What's more,finance products,high rate of return and covenant-lite,both make the financial disintermediation more evident.Because of the increasing of the cost,the commercial banks need to open up new business area.The characteristics of interbank business are lower cost,less capital occupy and lower capital relative to the risks.Owing to avoiding regulation and gaining profit,commercial banks largely depend on the interbank business to gain profits,which increase the liquidity risk,credit risk and systemic risk,and so influence the stability of commercial banks.The liquidity crisis in 2013 and bill cases in 2016 all remind us that the risks in interbank business,which should let regulators pay attention to it.Through related theory and empirical research,the paper analyses the risks in interbank business and influence to the stability fo banks,and then offer some proposals to reduce risks.The paper has positive thoretical significance and practical value in correctly understanding the risks in interbank business,measuring the influence to the stability of commercial banks.This paper hope to improve the recognization of commercial banks and regulation to the interbank business,and to enhance the level of inner control system and regulation.This paper first introduces the development situation of interbank business from five aspects:scale,composition,interest income,fund flow and maturity structure.Based on it,theoretical analyzes the impact of interbank business to stability of commercial banks:investing of loans,weakening of regulation,term mismatch,operational risk and interest rate risk.Then the paper uses empirical analysis to research how the interbank business impact to the stability of commercial banks.With interbank assets occupany rate,interbank liability occupany and index of term mismatch as explanatory variables,Z-score as dependent variables which is assumed to represent commercial banks stability,the empirical test is implemented.The results show that:the interbank assets share is negatively correlated with the risk taking,index of term mismatch is also negatively correlated with the risk taking.The final part put forward countermeasures and suggestions to promote the risk control:controling the size of interbank asset,structuring the index of financial regulation,reforming and completing the supervision system and reduce the risk of operational risk.