The Influence Of Interest Rate Liberalization On Commercial Banks Risk-taking

From 1996,our country established the unified inter-bank borrowing market firstly and then decontrolled gradually the loan interest's floating range and loan interest rate lower limit.until Oct 22th,2015,the central bank announced that the deposit interest rate upper limit canceled,the interest rate liberalization have been completed formally through 20 years' efforts.At the same time,the competition among commercial Banks has become more and intense.commercial Banks have to reprice,even choose risk behavior.Ultimately,it will affect the risk bearing ability of commercial Banks.Throughout the development process of the financial industry,the American sub-prime mortgage crisis in 2007,the European debt crisis in 2011,these all challenged the Banks' risk bearing ability.Therefore,studying commercial banks' risk bearing ability is very important and necessary.This study analyzed commercial Banks' risk bearing ability under the liberalization of interest based on the theory of transmission mechanism and data model.At first,this study analyzed The influence of interest rate liberalization on financial industry especially the direct influence on commercial Banks,as well as the effect of commercial Banks to their own choice to cause of commercial bank risk bearing change;Secondly multiple regression with short panel data,draw the conclusion:the interest rate liberalization level was positively correlated with commercial bank risk-taking.Conclusions at the end of the paper will put forward the corresponding suggestion,in order to reduce the pressure on the risk of commercial Banks,in order to improve the profitability of commercial Banks.