Social-digestion Mechanism of Bank Systemic Risk in China
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| Title | Social-digestion Mechanism of Bank Systemic Risk in China
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| Author | Tong Zhongwen, Fan Conglai, Xie Xiaoyang and Zou Jing |
| Organization | Nanjing Normal University, Nanjing University, Agricutural Bank of China |
| Email | lrhasia@163.com；fancl@nju.edu.cn；380747675@qq.com；fancl@nju.edu.cn |
| Key Words | Bank Systemic Risk; Netting Evolution; Macro Pressure Testing; Social-digestion; The Mystery of Financial Systemic Risk in China |
| Abstract | Bank systemic risk is a continuous accumulation process by the way of the story and credit. But all of these focus on the liquidity fluctuating. The bank systemic risk of China is always high consisting in the higher non-performing loan ratio before 2003 and worsening liquidity after 2003. Macro pressure testing showed the risk social-digestion mechanism avoided the financial crisis in short that included the risk self-digestion based on the game equilibrium and the rescue mechanism from soft budget constraint, but it bringed about the long-term effect including credit expanding, distorting of resources allocating and encouraging and moral risk which are making the bank system more and more fragile. Then the bank systemic risk is growing more severe. We must struct institutional-based to avoid and dissolve the bank systemic risk. |
| Serial Number | WP1085 |
| Time | 2016-07-22 |
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