Impact of shadow banking on Chinese banks’ efficiency: the moderating effect of ownership

This study examines the effect of shadow banking on the efficiency of Chinese banks and how ownership status moderates the relationship. It measures the technical efficiency score of a sample consisting of 160 Chinese commercial banks from 2011 to 2022 using data envelopment analysis via an intermed...

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Bibliographic Details
Main Authors: Chen, Jing, Kamarudin, Fakarudin, Amin Noordin, Bany Ariffin, Theng, Lau Wei, Zhou, Tim
Format: Article
Language:en
Published: Elsevier 2025
Online Access:http://psasir.upm.edu.my/id/eprint/120589/1/120589.pdf
http://psasir.upm.edu.my/id/eprint/120589/
https://linkinghub.elsevier.com/retrieve/pii/S1544612325009419
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Summary:This study examines the effect of shadow banking on the efficiency of Chinese banks and how ownership status moderates the relationship. It measures the technical efficiency score of a sample consisting of 160 Chinese commercial banks from 2011 to 2022 using data envelopment analysis via an intermediary approach. Using the ordinary least squares, feasible generalized least squares, and panel-corrected standard error estimation methods, the findings demonstrate that shadow banking significantly and positively affects bank efficiency for all banks in the sample. Furthermore, while foreign ownership strengthens this relationship, the inverse is true for joint-stock and city commercial banks. However, state-owned banks and rural commercial banks show insignificant moderating effects.