Research On The Impact Of Shadow Banking On Monetary Policy In China

In recent years,the scale of shadow banking in China has been increasing,and the types of business have been gradually enriched.It has changed the flow of funds and the way of social financing,and has a very important position in the financial system.On the one hand,shadow banking promotes financial innovation,improves the utilization rate of funds and injects liquidity into the financial market;on the other hand,because it is not fully regulated,concealed and term mismatch,shadow banking will bring certain risks to the financial market,affect the implementation effect of monetary policy,and is not conducive to achieving the intermediary targets and ultimate goals of monetary policyUnlike the shadow banks in developed countries,China's shadow banks started relatively late,and the degree of asset securitization is in the initial stage of development,with a relatively small scale.Due to the different financial environment at home and abroad,the institutional system and business types of China's shadow banking are quite different from those of developed countries.China's shadow banking institutions are independent and dispersed,and have not yet formed a mature shadow banking system.However,in recent years,China's shadow banking has developed continuously,and the scale of banking financial products,trust loans and entrusted loans has expanded rapidly.At that time,the Internet lending platform came into being.Shadow banks can use idle funds to provide financing channels for the society to solve the financing difficulties of small and medium-sized enterprises.However,many shadow banking businesses are not standardized,and shadow banks have the characteristics of not being fully regulated,term mismatch and so on,which may lead to crisis.At present,there is no agreement on the definition of shadow banking in China.Referring to the concept of shadow banking mentioned in the Financial Stability Council(FSB)report,this paper defines shadow banking as an institution that can create credit and provide liquidity for financial markets,similar to commercial banks,but not subject to the provisions of the Basel Accord.This paper divides China's shadow banking into three categories: first,the shadow banking business existing in commercial banks,such as entrusted loans,trust loans,non-discounted acceptance bills,and so on;second,thetype of banking institutions,such as trust companies,private equity funds,pawnbrokers,microfinance companies;third,the shadow banking under Internet finance,such as P2 P network lending platform.According to the definition of this article,shadow banking includes not only non-banking institutions,but also high-risk online lending platforms.In addition,private financial institutions have developed rapidly.These platforms and institutions act as credit intermediaries to provide loans for enterprises.Shadow banking has become a new financing channel for enterprises and residents,playing a huge role in the social financing structure.Therefore,it is of great significance to study the impact of shadow banking on China's monetary policy.It is not only conducive to enriching the theoretical research of shadow banking in the modern financial system,but also conducive to implementing more effective monetary policy and standardizing shadow banking.The bank should develop rationally,strengthen supervision over shadow banks,make them better play the functions of credit intermediation and social financing,ultimately enhance the transmission efficiency of monetary policy intermediary indicators,promote the smooth realization of the ultimate goal of monetary policy,better achieve the effect of monetary policy,thus ensuring the stability of China's financial industry and promoting the sustainable development of China's economy.This paper is divided into five parts,using literature research method,qualitative analysis and empirical analysis,based on the national conditions,a comprehensive and in-depth analysis of shadow banking's impact on monetary policy.The first part is introduction.This part mainly introduces the research background and significance;Summarize the domestic and foreign literature review,and summarize the views of predecessors;Propose research contents and methods;Finally,the article introduces the innovation and deficiency.The second part is the overview of shadow banking and the analysis of the current situation of shadow banking in China.This part explains the definition,characteristics,credit creation principle,status quo and causes of shadow banking in China successively.The third part is the theoretical analysis of the influence of shadow banking on China's monetary policy.This part studies the influence of shadow banking on monetary policy in China,and analyzes it from the perspectives of intermediate indicators andultimate goals of monetary policy.The fourth part is an empirical analysis of the influence of shadow banking on China's monetary policy.In this part,VAR model is built to study the impact of shadow banking on monetary policy in China.M2(broad money supply)and SF(social financing scale)are selected as intermediary indicators of monetary policy.GDP and CPI are selected as the ultimate goals of monetary policy.The fifth part is the suggestion to improve the effectiveness of monetary policy.Through theoretical analysis and empirical analysis,this paper puts forward specific Suggestions on the impact of shadow banking on monetary policy in China.Through theoretical analysis and empirical analysis,the shadow Banks as well as commercial Banks,has a strong credit creation function,shadow Banks provide plenty of liquidity to markets,so it increases social financing scale,reduce statistics in the money supply,make the consumer price index and economic output growing.According to the results of this analysis,this paper puts forward the corresponding proposal: a statistics of the shadow banking system is established,the shadow Banks in the money supply statistical scope,clearly defining the scope of the shadow banking,in order to improve intermediary index conduction efficiency,it is to standardize the shadow banking system,improve the barriers to entry shadow banking institutions,to strengthen the regulation of the shadow banking,in view of the shadow banking make effective policies,encourage healthy development of the shadow banking system,strengthen the shadow banking regulation,prevent the regulation does not reach the designated position and the risk,to promote the ultimate goal smooth realization.