دانلود مقاله ISI انگلیسی شماره 13675
عنوان فارسی مقاله

رشد سیستم سایه بانکی در بازارهای نوظهور: شواهدی از هند

کد مقاله سال انتشار مقاله انگلیسی ترجمه فارسی تعداد کلمات
13675 2013 24 صفحه PDF سفارش دهید محاسبه نشده
خرید مقاله
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عنوان انگلیسی
The growth of a shadow banking system in emerging markets: Evidence from India
منبع

Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)

Journal : Journal of International Money and Finance, Volume 39, December 2013, Pages 207–230

کلمات کلیدی
سایه بانکی - شرکت های بزرگ مالی غیر بانکی - بحران - ریسک سیستمیک - تضمین دولت -
پیش نمایش مقاله
پیش نمایش مقاله رشد سیستم سایه بانکی در بازارهای نوظهور: شواهدی از هند

چکیده انگلیسی

We study the determinants of the growth of those non-deposit taking non-bank financial corporations (NBFCs) which are regarded by the Reserve Bank of India as being systemically important and have grown substantially in India over the past decade. We document that bank lending to NBFCs (i) forms a significant proportion of the NBFC liabilities; (ii) fluctuates in line with bank allocation to priority lending sectors; (iii) decreases as the banks expand in the rural areas relative to urban areas; but, (iv) is virtually non-existent for the largest state-owned bank, namely State Bank of India (SBI) and its affiliates which have significant rural branch network. Starting with the financial crisis of Fall 2008, bank lending to NBFCs experienced a permanent contraction shock related to the shift of term deposits toward SBI away from other banks. These bank-NBFC linkages are present primarily for, and affect the credit growth of, those NBFCs that do loans or asset financing but not the investment companies. Overall, the findings suggest that in contrast to the prevailing views of shadow banking in the Western economies, lending to NBFCs in India is viewed by banks as a substitute for direct lending in the non-urban areas of the Indian economy, but this substitution is constrained by distortions in bank deposit flows due to the perceived differential government support of different banking groups.

مقدمه انگلیسی

We investigate the rapid growth of the non-bank financial corporations (NBFCs) in India as a laboratory to understand incentives underlying the growth of shadow banking institutions in emerging markets. Our main finding is that unlike the prevailing views on shadow banking 1 in the Western economies, which concern desire to provide “safe” collateral for financial transactions and mitigate counterparty risk 2 or simply to arbitrage bank regulations such as capital requirements, 3 the NBFCs in India appear to be substitutes for direct lending by banks in the non-urban parts of the Indian economy. Indeed, and consistent with the prevailing views of shadow banking, NBFCs in India are also linked to the banking sector, in particular, through bank lending to NBFCs which forms a significant proportion of NBFC liabilities. We study how these bank-NBFC linkages affect NBFC credit growth, how the linkages vary across types of banks in their ownership structure (state-owned versus private in case of banks), rural bank branching network relative to urban branching, and function of the NBFC (Financing versus Investment), and finally, what impact did the financial crisis in Fall 2008 have on these linkages given the relative shift of term deposits into state-owned banks due to their stronger perceived guarantees. Exploiting a special dataset4 of individual NBFCs over the period 2006–2011 that we collected from the Reserve Bank of India (RBI), we examine the following questions. 1) Does bank lending to the priority sectors5 influence bank lending to the NBFCs and, in turn, how does NBFC lending itself gets affected? 2) Does bank branch expansion in rural areas relative to urban areas influence bank lending to the NBFCs and, in turn, how does NBFC lending itself gets affected? 3) Do term deposits (the more stable or less fragile form of deposits) at banks influence bank lending to the NBFCs and, in turn, how does NBFC lending itself gets affected? 4) Did the crisis have a long-term effect on the bank lending to the NBFCs and, in turn, how did NBFC lending itself get affected? 5) Do these channels influence the Investment Company and Financing Company NBFCs similarly or differentially? Our results provide four interesting properties of bank lending to NBFCs in India over the period 2006–2011. One, bank lending to NBFCs fluctuates in line with bank allocation to priority lending sectors; and second, this lending decreases as the banks expand in the rural areas relative to urban areas but this relationship is virtually non-existent for the largest state-owned bank, namely the State Bank of India (SBI) and its affiliates which have significant rural branch network of their own. Third, these bank-NBFC linkages are present primarily for, and affect the credit growth of, those NBFCs that do loans or asset financing but not the investment companies (whose activities are focused on acquiring securities, and not on lending). All of these findings suggest that the banks view the NBFCs as a substitute for direct lending in the non-urban areas of the Indian economy. This view of the NBFCs is consistent with the current explanations of their recent growth in India (Duggal and Kapali, 2012; Deosthalee, 2010) which focus on NBFC's greater ability compared to banks in reaching out to small borrowers in far-flung rural areas, upcoming small- and medium-sized enterprises, enterprising self-employed service providers, mid-market corporates and emerging infrastructure developers. Fourth, starting with the financial crisis of Fall 2008, bank lending to NBFCs experienced a permanent contraction shock related to the shift of term deposits (relative to demand deposits) toward the SBI – and then to other state-owned banks – away from other banks. Acharya and Kulkarni (2012, 2013) show empirically that this shift of deposits – and the relative out-performance – of state-owned banks during 2008 appeared to be unrelated to measures of their vulnerability to market downturns, whereas private banks experienced deposit withdrawals and shortening that were correlated to their vulnerability to market downturns. They further show that state-owned banks increased their loan advances, at cheaper rates, and especially to public sector firms and priority lending sectors. Consistent with their findings, we document that the deposit shift across bank types in Fall 2008 reduced bank lending to the NBFCs. Overall, our findings suggest that in contrast to the prevailing views of shadow banking in the Western economies, the NBFCs in India appear to provide a completeness of credit spectrum in the economy, with banks lending to the NBFCs as a substitute for direct lending to non-urban parts of the economy. While this economic function and its financing by banks help understand the recent growth of the NBFCs, this growth and its financing by banks has been affected over time due to deposit shifts attributable to perceived government guarantees between banks with and without significant non-urban reach in their branch networks. We organize the rest of the paper as follows. Section 2 introduces the NBFC and bank groupings we employ in the paper. Section 3 presents the datasets we employ on NBFCs and banks. Section 4 presents our primary questions of interest and the leading econometric specifications we employ. Section 5 presents the results. Section 6 concludes.

نتیجه گیری انگلیسی

We study in this paper the determinants of the growth of those non-deposit taking non-bank financial corporations (NBFCs) which are regarded by the Reserve Bank of India as being systemically important and have grown substantially in India over the past decade. We document that bank lending to these NBFCs forms a significant proportion of their liabilities, and fluctuates in line with bank allocation to priority lending sectors. Bank lending to NBFCs in turn affects their credit growth, so that the recent growth in assets of the NBFCs can be understood as being increasingly financed by funding from banks. Bank lending to these NBFCs also appears to be greater for banks that have lower branching in non-urban areas relative to urban areas. However, this bank-NBFC linkage is virtually non-existent for the largest state-owned bank, the State Bank of India (SBI), and its affiliates, which have a deep rural branching network of their own. Interestingly, these bank-NBFC linkages are present primarily for those NBFCs that do loans or asset financing and not for investment companies. Overall, the findings suggest that NBFCs are seen by banks with less than fully-developed branching networks as a completeness of credit allocation in non-urban areas of the Indian economy, but that this economic role played by the NBFCs has been potentially constrained since Fall 2008 by distortions in bank deposit base arising from a lack of level-playing field in the perceived government support of different banking groups. Since the NBFCs are relatively well-regulated on the capital front, it is primarily their linkage to the banking sector that stands out as a potential concern for systemic risk considerations. This concern complements the issues regarding potential systemic risk of the NBFCs raised in the Thorat report (2011) relating to their concentration in specific asset markets. Furthermore, our results highlight that shadow banking in emerging markets may look quite different from that in developed economies: well-capitalized, potentially filling in gaps of inadequate intermediation (as explained also in the Indian NBFC summaries by Deosthalee, 2010; Duggal and Kapali, 2012), and affected during crises by the flight of deposits to state-owned banks in such economies. Micro- and macro-prudential considerations of such shadow banks or non-bank finance companies may not necessarily resemble those in the developed economies, and is a worthy topic for future research. For instance, regulators may wish to remove or at least reduce restrictions on bank branching networks to enable banks to have the reach and specialization of lending in non-urban areas that NBFCs appear to be providing. However, if such restrictions are not removed, then attempts to regulate the credit growth of NBFCs may end up under-serving the relatively unbanked parts of the economy even further.

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