The Value of the Banking Governance Reform in China

72 Pages Posted: 31 Dec 2022 Last revised: 23 May 2024

See all articles by Gang Bai

Gang Bai

Southwestern University of Finance and Economics (SWUFE) - School of Finance

Hengguo Da

Southwestern University of Finance and Economics

Date Written: December 9, 2022

Abstract

In this paper, we leverage the bank governance reform in China as a laboratory to explore the impact of the banking governance system on lending activities. Specifically, a well-functioning governance system does not improve the bank’s selection abilities. However, a good governance system enhances the bank’s monitoring abilities. Those findings are explained by the reason that the government distorts the bank selection process via the industrial policy in China. Therefore, this paper sheds light on banking governance and has important policy implications for bank policymakers in the transition economy.

Keywords: Banking, Banking Governance, Governance Reform, Chinese Economy

JEL Classification: G10, G21,G38

Suggested Citation

Bai, Gang and Da, Hengguo, The Value of the Banking Governance Reform in China (December 9, 2022). Available at SSRN: https://ssrn.com/abstract=4315510 or http://dx.doi.org/10.2139/ssrn.4315510

Gang Bai

Southwestern University of Finance and Economics (SWUFE) - School of Finance ( email )

Chengdu, 610074
China

Hengguo Da (Contact Author)

Southwestern University of Finance and Economics ( email )

55 Guanghuacun St,
Chengdu, Sichuan 610074
China

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