The Impact of Asset Quality and Capital Supervision on Credit Expansion of Commercial Banks in China

摘要

As a form of indirect financing methods,commercial bank credit,which is beneficial to China's economic and social development,has already been an important component of China's social financing.Based on data of 12 commercial banks of China from 1995 through 2011,panel regressions are conducted with the result showing that supervision of asset quality and capital adequacy ratio has significant constraint on the scale and decision of credit expansion.It seems that hard supervision at banking sector is helpful for sound operation of commercial banks to guard against and defuse financial risks.