The cyclical behavior of Chinese bank capital buffers

摘要

Using an unbalanced panel of accounting data from 2007 to 2011 covering 60 Chinese commercial banks,we have done an empirical research on the relationship between capital buffer and business cycle.After controlling for the determinants of capital buffer,we find a robustly significant negative relationship between capital buffer and the position in cycle.Namely,Chinese commercial bank capital buffers are pro-cyclical.