Research on Shadow Bank and the Impact on Financial Security of China

Abstract

This paper analyzes the essential characters and the risks of shadow bank, summarizes the differences of shadow bank in China and the other western developed countries, and gives some suggestions on the regulation of shadow bank in China. Shadow bank is the financial innovation growing with the economic development. And it’s a positive force to promote financial development. But its impact on the macro-control’s mechanism and effectiveness and its character of gathering risk threaten the financial security. The development of Chinese financial market is not perfect. The domestic shadow bank also shows different characters from the United States and the other developed western countries. Its characters mainly behave in the rapid development of private investment and the lack of regulation. It’s very necessary to improve relevant regulations and regulatory in order to ensure the healthy and orderly development of Chinese shadow bank.