Study About The Impact Of Capital Regulation On The Risk Taking Of China's Listed Commercial Banks

The global financial crisis triggered by the US subprime mortgage crisis in 2008 led to a slowdown in the development of the world economy,brought a huge burden on the society,and caused heavy losses to economies around the world.The occurrence of the financial crisis has exposed the deficiency of Basel II and the current regulatory requirements have failed to promote commercial banks to carry out sound operations.After that,all countries hope to establish a new international standard to strengthen the supervision of the banking industry,improve the stability of the banking industry,and prevent the occurrence of systematic financial risks,give full play to the role of servicing economy operation.In the supervision system of commercial banks,capital supervision has always been at the core;in this context,the Basel Committee issued Basel III and proposed a higher standard of capital adequacy,emphasizing the importance of core tier 1 capital adequacy ratios;introduce leverage ratio regulation.Since China implement a hard constraint on capital supervision in 2004,the capital adequacy of listed commercial banks has been greatly improved,this is conducive to enhancing business stability.In 2012,the China Banking Regulatory Commission learn from the "Basel III" and promulgated the "Administrative Measures for the Capital Management of Commercial Banks(Trial)" and proposed new capital regulatory requirements;this paper studies the impact of capital regulation on listed commercial banks is of epochal significance.Firstly,this paper sort the theory,due to the existence of negative externalities,imperfect competition and asymmetric information,commercial banks will increases the risk taking,capital regulation is necessary as an external force to constrain the behavior of commercial banks.The purpose of capital regulation is to constrain the risk taking behavior of listed commercial banks through continuous high capital requirements and to achieve the purpose of enhancing bank stability;the effective effect of capital supervision is that,under regulatory requirements,listed commercial banks continue to constrain risk exposure and maintain their ability to continue to meet capital requirements by reducing the proportion of high capital-consuming assets.In this paper,based on this research idea,in view of the fact that China's listed banks generally hold capital buffers,we examine the impact of capital supervision on risk taking from the perspective of capital buffering,and thus test the effectiveness of China's capital supervision on listed commercial banks.This paper using the data of 15 listed commercial banks from 2005 to 2016,firstly conduct a full sample analysis and conclude that capital supervision can constrain risk taking.Then,according to the implementation of the new regulatory agreement,it is divided into two phases for comparative analysis.It is concluded that the new supervisory agreement has strengthened the restraining effect and shows that China's existing capital supervision policy is effective for listed commercial banks.The innovation of this paper lies in the innovation of research perspectives,to examines the impact of capital supervision on the risk taking of listed commercial banks from the perspective of adequate buffering of core tier 1 capital,to test whether core tier 1 capital plays a role in constraining the risk taking of listed commercial banks and enhancing the stability of financial system,to examines the effects of capital supervision in many aspects.It is found empirically that the supervision of core tier 1 capital adequacy can constrain the risk taking of listed commercial banks,this is a new discovery of this article.In addition,according to the different regulatory policies,it is divided into two phases for comparative analysis,and it is found that the new regulatory agreement have strengthened the constraint effect of capital supervision on the risk taking of listed commercial banks.