The effectiveness of capital regulation on bank behavior in China

Simple item page
dc.contributor.authorFu, Y.
dc.contributor.authorLee, S.
dc.contributor.authorXu, L.
dc.contributor.authorZurbruegg, R.
dc.date.issued2015
dc.description.abstractThis paper examines the impact that ownership and governance structures have on how Chinese banks react to regulatory pressure. We find that the current regulatory regime induces banks to increase their capital, but its effectiveness in doing so varies based on whether the bank is listed or not, and also who is the majority shareholder. We also find that the degree of central government ownership and the political ties the chief executive officer of the bank has play an important role in the risk-taking behavior of banks. Overall, our results have a number of policy implications supporting the need to further reduce state ownership of banks in China to mitigate the prevailing moral hazard and dual-agency problems that arise from the government being both the regulator and the majority shareholder.
dc.description.statementofresponsibilityYishu Fu, Shih-Cheng Lee, Lei Xu, Ralf Zurbruegg
dc.identifier.citationInternational Review of Finance, 2015; 15(3):321-345
dc.identifier.doi10.1111/irfi.12045
dc.identifier.issn1369-412X
dc.identifier.issn1468-2443
dc.identifier.orcidZurbruegg, R. [0000-0002-8652-0028]
dc.identifier.urihttp://hdl.handle.net/2440/107690
dc.language.isoen
dc.publisherWiley-Blackwell
dc.rights© 2015 International Review of Finance Ltd. 2015
dc.source.urihttps://doi.org/10.1111/irfi.12045
dc.subjectG21; G28
dc.titleThe effectiveness of capital regulation on bank behavior in China
dc.typeJournal article
pubs.publication-statusPublished

Files

Collections

Economics publications