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Fintech, macroprudential policies and bank risk: Evidence from China

Yang Zhao, John W. Goodell, Yong Wang, Mohammad Abedin Orcid Logo

International Review of Financial Analysis, Volume: 87, Start page: 102648

Swansea University Author: Mohammad Abedin Orcid Logo

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DOI (Published version): 10.1016/j.irfa.2023.102648

Abstract

We explore the relationship between fintech, macroprudential policies, and commercial bank risk-taking. Based on system generalized method of moment modeling on a panel data of 114 commercial banks in China from 2013 to 2020, results show that there are functional differences in the impact of fintec...

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Published in: International Review of Financial Analysis
ISSN: 1057-5219 1873-8079
Published: Elsevier BV 2023
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URI: https://cronfa.swan.ac.uk/Record/cronfa64220
first_indexed 2023-09-20T15:37:48Z
last_indexed 2024-11-25T14:13:38Z
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spelling 2023-09-20T16:37:49.1726593 v2 64220 2023-08-31 Fintech, macroprudential policies and bank risk: Evidence from China 4ed8c020eae0c9bec4f5d9495d86d415 0000-0002-4688-0619 Mohammad Abedin Mohammad Abedin true false 2023-08-31 CBAE We explore the relationship between fintech, macroprudential policies, and commercial bank risk-taking. Based on system generalized method of moment modeling on a panel data of 114 commercial banks in China from 2013 to 2020, results show that there are functional differences in the impact of fintech on bank risk-taking. Payment and settlement technology (PST), capital raising technology (CRT) and investment management technology (IMT) are positively correlated with bank risk-taking. In contrast, market facility technology (MFT) negatively correlates with bank risk-taking. We also find that macroprudential policies weaken the promotion effect of CRT on bank risk-taking and strengthen the inhibition effect of MFT on bank risk-taking while having no significant moderating effect on PST and bank risk, IMT and bank risk. Further, the micro characteristics of banks (capital adequacy ratio, asset scale, liquidity level) affects the moderating strength of macroprudential policies. Various robustness tests confirm our conclusions. Journal Article International Review of Financial Analysis 87 102648 Elsevier BV 1057-5219 1873-8079 Fintech, Macroprudential policies, Bank risk-taking 31 5 2023 2023-05-31 10.1016/j.irfa.2023.102648 http://dx.doi.org/10.1016/j.irfa.2023.102648 COLLEGE NANME Management School COLLEGE CODE CBAE Swansea University 2023-09-20T16:37:49.1726593 2023-08-31T17:18:49.1915559 Faculty of Humanities and Social Sciences School of Management - Accounting and Finance Yang Zhao 1 John W. Goodell 2 Yong Wang 3 Mohammad Abedin 0000-0002-4688-0619 4
title Fintech, macroprudential policies and bank risk: Evidence from China
spellingShingle Fintech, macroprudential policies and bank risk: Evidence from China
Mohammad Abedin
title_short Fintech, macroprudential policies and bank risk: Evidence from China
title_full Fintech, macroprudential policies and bank risk: Evidence from China
title_fullStr Fintech, macroprudential policies and bank risk: Evidence from China
title_full_unstemmed Fintech, macroprudential policies and bank risk: Evidence from China
title_sort Fintech, macroprudential policies and bank risk: Evidence from China
author_id_str_mv 4ed8c020eae0c9bec4f5d9495d86d415
author_id_fullname_str_mv 4ed8c020eae0c9bec4f5d9495d86d415_***_Mohammad Abedin
author Mohammad Abedin
author2 Yang Zhao
John W. Goodell
Yong Wang
Mohammad Abedin
format Journal article
container_title International Review of Financial Analysis
container_volume 87
container_start_page 102648
publishDate 2023
institution Swansea University
issn 1057-5219
1873-8079
doi_str_mv 10.1016/j.irfa.2023.102648
publisher Elsevier BV
college_str Faculty of Humanities and Social Sciences
hierarchytype
hierarchy_top_id facultyofhumanitiesandsocialsciences
hierarchy_top_title Faculty of Humanities and Social Sciences
hierarchy_parent_id facultyofhumanitiesandsocialsciences
hierarchy_parent_title Faculty of Humanities and Social Sciences
department_str School of Management - Accounting and Finance{{{_:::_}}}Faculty of Humanities and Social Sciences{{{_:::_}}}School of Management - Accounting and Finance
url http://dx.doi.org/10.1016/j.irfa.2023.102648
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description We explore the relationship between fintech, macroprudential policies, and commercial bank risk-taking. Based on system generalized method of moment modeling on a panel data of 114 commercial banks in China from 2013 to 2020, results show that there are functional differences in the impact of fintech on bank risk-taking. Payment and settlement technology (PST), capital raising technology (CRT) and investment management technology (IMT) are positively correlated with bank risk-taking. In contrast, market facility technology (MFT) negatively correlates with bank risk-taking. We also find that macroprudential policies weaken the promotion effect of CRT on bank risk-taking and strengthen the inhibition effect of MFT on bank risk-taking while having no significant moderating effect on PST and bank risk, IMT and bank risk. Further, the micro characteristics of banks (capital adequacy ratio, asset scale, liquidity level) affects the moderating strength of macroprudential policies. Various robustness tests confirm our conclusions.
published_date 2023-05-31T14:28:00Z
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score 11.048149

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