 Interest rate liberalization and the stability of the Chinese banking system: Exploring chained mediation effects of deposit competitiveness and wealth management productsKuan Kang, Zariyawati Mohd Ashhari, Mohamed Hisham Dato Hj Yahya, Wei Ni Soh and Yue Li Finance Research Letters, 2024, vol. 62, issue PB Abstract: This study uses quarterly unbalanced panel data of 46 commercial banks and adopts a two-step system generalized method of moments to inspect the direct and indirect effects of interest rate liberalization (IRL) on banking stability from 2015 to 2021 in China. The results show that IRL enhances banking stability and brings deposit competition among banks, which affects banking stability. Meanwhile, wealth management products (WMPs) with higher market-based yields have increased dramatically as competitive substitution of deposits. The bootstrap test confirms the chained mediation effects of deposit competitiveness and WMPs development on the relationship between IRL and banking stability. Keywords: Interest rate liberalization; Wealth management products; Deposit competitiveness; Banking Stability; Chained Mediation Effects (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:62:y:2024:i:pb:s1544612324002526 DOI: 10.1016/j.frl.2024.105222 Access Statistics for this article Finance Research Letters is currently edited by R. Gençay More articles in Finance Research Letters from Elsevier |
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