Banks’ Lending under the Capital Adequacy Supervision

Jun-xun DAI, Lu YANG


Due to the profound influence of banking crisis on economic growth, the capital adequacy has been closely concerned by financial authorities in many nations. Thanks to globalization of business, the financing environment has improved. Therefore, a number of restrictions on banking sectors has been not as tough as once were.
However, the requirements on capital adequacy have been stricter than ever. Yet the behavior adjustment of banking sectors and its effects on every aspects of national economy still provokes controversy. As various theories and abundant evidences indicate --- the implementation of Basel Agreement would lead to social credit crunch due to the fact that national commercial banks reduce credit transaction in order to meet the requirement of capital regulation(8%), which would negatively affect the stability of macro-economy.
This thesis intents to answer, via theoretical analysis and demonstration in banking system of Hubei Province, the question of potential adjustment and shrinking effects after implanting Capital Regulation of Commercial Banks. We believe since the implementing of new principle in 2004, each bank has adjusted their gross and structure of credit. The effect of credit crunch is mainly seen by the impacts on small and middle sized enterprises.
Key words: capital adequacy, risk-taking incentives, credit crunch
Résumé: En raison de l’influence profonde de la crise bancaire sur la croissance économique, les autorités financières de beaucoup de pays prêtent une grande attention à la suffisance du capital. Grâce à la globalisation du commerce, l’environnment financier s’est amélioré. Donc, de nombreuses restrictions dans le secteur bancaire ne sont plus aussi dures qu’elles étaient autrefois.
Cependant, l’exigence de la suffisance du capital est plus stricte qu’auparavant. L’ajustement du secteur bancaire et son influence sur tous les aspects de l’économie nationale provoquent quant même des controverses. De diverses théories et des preuves abondantes indiquent que l’application de Basel Agreement pourrait conduire au resserrement de crédit dû au fait que les banques commerciales réduisent leur offre de crédit afin de répondre à la demande de la régulation du capital(8%), ce qui pourrait affecter négativement la stabilité de la macro-économie.
L’essai présent tente de répondre, par le biais de l’analyse théorique et la démonstration du système bancaire de la province du Hubei, à la question de l’ajustement potentiel et des effets diminutifs après la mise en oeuvre de la Régulation du Capital des Banques Commerciales. Nous croyont, depuis la mise en application du nouveau principe en 2004, chaque banque a ajusté leur total et structure du crédit. Les effets du resserrement de crédit se voient principalement dans ses influences sur les petites et moyennes entreprises.
Mots-Clés: suffisance du capital, motivation de la prise de risque, resserrement de crédit

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