IDEAS home Printed from https://ideas.repec.org/a/nbp/nbpbik/v50y2019i4p347-374.html
   My bibliography  Save this article

The interconnectedness between traditional banks, shadow banking and non-performing loans in the Chinese economy

Author

Listed:
  • Piotr Łasak

    (Jagiellonian University, Faculty of Management and Social Communication)

  • Alicja Szyszko

    (Jagiellonian University, Faculty of Management and Social Communication)

  • Patryk Pagacz

    (Jagiellonian University, Faculty of Mathematics and Computer Science)

Abstract

During the last few decades, China has been developing traditional banking in parallel to the shadow banking sector. The unregulated part of the Chinese financial market is strictly interconnected with traditional banks. It was especially visible after the financial crisis of 2008−2010, when shadow banking helped to fuel the economy with debt on a large scale. The excessive investments in some sectors of the Chinese economy contributed to the growth of NPLs in traditional banks. Shadow banking being entangled with the formal Chinese banking sector might be enumerated among the crucial causes of the process. The authorities and regulating bodies implemented many measures aimed to limit the amount of bad debt, together with limiting the operations of shadow banking entities, but the final result of these activities is still unknown. It might be predicted that the level of NPLs will not be constrained in the near future.

Suggested Citation

  • Piotr Łasak & Alicja Szyszko & Patryk Pagacz, 2019. "The interconnectedness between traditional banks, shadow banking and non-performing loans in the Chinese economy," Bank i Kredyt, Narodowy Bank Polski, vol. 50(4), pages 347-374.
    • Handle: RePEc:nbp:nbpbik:v:50:y:2019:i:4:p:347-374
    as

    Download full text from publisher

    File URL: https://bankikredyt.nbp.pl/content/2019/04/BIK_04_2019_01.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Chinese banking sector; non-performing loans; shadow banking;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • N25 - Economic History - - Financial Markets and Institutions - - - Asia including Middle East
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbp:nbpbik:v:50:y:2019:i:4:p:347-374. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wojciech Burjanek (email available below). General contact details of provider: https://edirc.repec.org/data/nbpgvpl.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.