Proceedings of the 2022 International Conference on Economics, Smart Finance and Contemporary Trade (ESFCT 2022)

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Fintech Application and Bank Risk-Taking: Evidence from Chinese City Commercial Banks

Authors
Pengqin Li1, *
1Business School, Nanjing Normal University, Nanjing, 210023, China
*Corresponding author. Email: 15190320@njnu.edu.cn
Corresponding Author
Pengqin Li
Available Online 27 December 2022.
DOI
10.2991/978-94-6463-052-7_97How to use a DOI?
Keywords
Fintech; City commercial banks; Bank credit risk-taking; Text mining
Abstract

Fintech is reshaping the entire financial industry, dramatically changing the operation model of traditional finance. Traditional commercial banks are confronted with challenges and opportunities as a result of fintech. The development of fintech has resulted in great uncertainty in the realm of bank security, and thus clarifying the nexus between fintech application and bank risk-taking makes sense. Using a text mining technique, this study created a comprehensive index to quantify each sample bank's specific fintech application. With relevant data, this study designed a regression model with a few variables and compared the results to the current situation in China. According to the findings, fintech application and bank credit risk-taking have an inverted U connection. The fintech application initially elevates credit risk taken by banks; but, as fintech application grows more advanced, it will have the opposite effect on bank credit risk-taking, lowering bank non-performing loan rates. Furthermore, this research demonstrates that bank size, deposit-asset rate, and ROA indicators all lessen credit risk, whereas the loan-asset rate strengthens it. The finding suggests that it is advantageous to accelerate the integration of fintech and commercial banks. Banks should exploit the chances presented by the fintech revolution and execute a digital transformation strategy.

Copyright
© 2022 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 2022 International Conference on Economics, Smart Finance and Contemporary Trade (ESFCT 2022)
Series
Advances in Economics, Business and Management Research
Publication Date
27 December 2022
ISBN
10.2991/978-94-6463-052-7_97
ISSN
2352-5428
DOI
10.2991/978-94-6463-052-7_97How to use a DOI?
Copyright
© 2022 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Pengqin Li
PY  - 2022
DA  - 2022/12/27
TI  - Fintech Application and Bank Risk-Taking: Evidence from Chinese City Commercial Banks
BT  - Proceedings of the 2022 International Conference on Economics, Smart Finance and Contemporary Trade (ESFCT 2022)
PB  - Atlantis Press
SP  - 850
EP  - 859
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-052-7_97
DO  - 10.2991/978-94-6463-052-7_97
ID  - Li2022
ER  -