An Empirical study of Loan loss provisioning hypotheses for Chinese banking industry

This paper provides an empirical study on the loan loss provisions (LLP) of 188 unconsolidated commercial banks in China from the year of 2007 to 2016. The loan loss provisioning in China is under multiple regulatory forces and the regime causes challengers for practical applications. Critical reforms have been made to the LLP regulatory regimes over the past few years. But contradictions arise from these regulatory standards. For the empirical research, a Cost-efficiency analysis is first carry out to estimate the efficiency scores in Chinese Banking industry over the last ten years. The Chinese banking industry was found to be cost efficient, the efficiency scores are then used as a potential explanatory variable for LLP behaviour model. The main estimations are the three LLP behaviour hypotheses regarding business cyclical provisioning, income smoothing and capital management. A joint model using two steps system Generalized Method of Moments (GMM) offers empirical implication for further analysis. While the income smoothing hypothesis are supported by empirical evidence, the cyclical provisions and capital management do not show significant practices in China. In the end, this paper also provided some practical limitation and improvement suggestions for the Loan loss provisioning analysis in China. KEYWORDS: Loan loss provisioning, Chinese Banking, Capital management hypothesis, Income smoothing, Cost-efficienc

An Empirical study of Loan loss provisioning hypotheses for Chinese banking industry

This paper provides an empirical study on the loan loss provisions (LLP) of 188 unconsolidated commercial banks in China from the year of 2007 to 2016. The loan loss provisioning in China is under multiple regulatory forces and the regime causes challengers for practical applications. Critical reforms have been made to the LLP regulatory regimes over the past few years. But contradictions arise from these regulatory standards. For the empirical research, a Cost-efficiency analysis is first carry out to estimate the efficiency scores in Chinese Banking industry over the last ten years. The Chinese banking industry was found to be cost efficient, the efficiency scores are then used as a potential explanatory variable for LLP behaviour model. The main estimations are the three LLP behaviour hypotheses regarding business cyclical provisioning, income smoothing and capital management. A joint model using two steps system Generalized Method of Moments (GMM) offers empirical implication for further analysis. While the income smoothing hypothesis are supported by empirical evidence, the cyclical provisions and capital management do not show significant practices in China. In the end, this paper also provided some practical limitation and improvement suggestions for the Loan loss provisioning analysis in China. KEYWORDS: Loan loss provisioning, Chinese Banking, Capital management hypothesis, Income smoothing, Cost-efficienc

Does having a culture of giving support financial inclusion?

There have been studies on the benefits of financial inclusion, and culture as an alternative channel to impact financial inclusion. However, due to the multifaceted nature of culture, there have been no studies done on the impact of culture of giving or philanthropy on financial inclusion. This paper thus aims to propose that encouraging a culture of giving will positively affect financial inclusion. Using a sample of 115 countries, we adopted the Ordinary Least Squares (OLS) approach in running the regressions. Specifically, the OLS regression results indicate that a culture of giving is significantly correlated with financial inclusion, where a one standard deviation increase in the culture of giving is associated with an improvement in the financial inclusiveness of a nation by 0.557 standard deviation units. Subsequently, in order to ensure the robustness of our results, alternative measures of financial inclusion were substituted into the regression model and regressed separately. Empirical results indicate that regardless of the measures of FI used, the culture of giving remains to have a positive correlation with FI, ceteris paribus. Lastly, WGI is substituted with its 3 subcomponents and regressed separately, offering an in-depth analysis with regards to the importance and predictive effects of the different aspects of WGI on FI. Empirical results suggest that Giving Money and Giving Time could be the key areas within a culture of giving to be focused on, as they were statistically significant in predicting FI.Bachelor of Social Sciences in Economic

Calculation of Resonance Fluorescence Scattering Cross Sections of Metal Particles in the Middle and Upper Atmosphere and Comparison of Their Detectability

Resonance fluorescence scattering is the physical mechanism with which lidar detects atmospheric metal layers. The resonance fluorescence scattering cross section is an important parameter for lidar data processing. In this work, the resonance fluorescence backscattering cross sections of most detectable metal atoms and ions in the atmosphere were calculated. The calculated maximum backscattering cross section of Na at the D2 line is 7.38 × 10−17 m2/sr; K at the D1 line is 7.37 × 10−17 m2/sr; Fe at the 372 nm line is 7.53 × 10−18 m2/sr; Fe at the 374 nm line is 6.98 × 10−18 m2/sr; Fe at the 386 nm line is 3.75 × 10−18 m2/sr; Ni at the 337 nm line is 4.05 × 10−18 m2/sr; and Ni at the 341 nm line is 2.05 × 10−17 m2/sr; Ca is 3.06 × 10−16 m2/sr; Ca+ is 1.12 × 10−16 m2/sr. The influence of the laser linewidth on the effective scattering cross section was discussed. If the laser linewidth is lower than 2 GHz to detect Na, the laser center frequency locked at the D2a line is a better option than the D2 line in order to obtain greater signals. If an unlocked lidar is used to detect Na, the frequency at D2a should be used as the laser center frequency when the effective scattering cross section of Na was calculated, because the absorption cross section of Na atom has two local maxima. This work proposes a quantifiable comparative method for assessing the observation difficulty of different metal particles by comparing their relative uncertainties in lidar observation. It is assumed that under the same observation conditions, the detectability of different metal atoms and ions is compared. Using Na as a basis for comparison, the relative uncertainty of Ni at 337 nm is the highest, about a factor of 21 larger than that of Na, indicating that it is the most difficult to be detected. The purpose of this work is to present a quantifiable comparison method for the detection difficulty of the metal particles by lidar in the middle and upper atmosphere, which has great significance for the design of the lidar system

Tuning Superhydrophobic Materials with Negative Surface Energy Domains

Hydrophobic/superhydrophobic materials with intrinsic water repellence are highly desirable in engineering fields including anti-icing in aerocrafts, antidrag and anticorrosion in ships, and antifog and self-cleaning in optical lenses, screen, mirrors, and windows. However, superhydrophobic material should have small surface energy (SE) and a micro/nanosurface structure which can reduce solid-liquid contact significantly. The low SE is generally found in organic materials with inferior mechanical properties that is undesirable in engineering. Intriguingly, previous theoretical calculations have predicted a negative SE for θ-alumina (θ-Al2O3), which inspires us to use it as a superhydrophobic material. Here, we report the experimental evidence of the small/negative SE of θ-Al2O3 and a θ-Al2O3-based superhydrophobic coating prepared by one-step scalable plasma arcing oxidation. The superhydrophobic coating has complete ceramic and desired micro/nanostructure and therefore exhibits excellent aging resistance, wear resistance, corrosion resistance, high-temperature tolerance, and burning resistance. Owing to the rarity of the small/negative SE in inorganic materials, the concept to reduce SE by θ-Al2O3 may foster a blowout to develop robust superhydrophobicity by complete inorganic materials

Mechanical properties and electromagnetic shielding performance of single-source-precursor synthesized dense monolithic SiC/HfCxN1-x/C ceramic nanocomposites

For the first time, single-source-precursor synthesized dense monolithic SiC/HfCxN1-x/C ceramic nanocomposites with outstanding electromagnetic (EM) shielding performance at temperatures up to 600 degrees C are reported. The total shielding effectiveness (SET) of the SiC/HfCxN1-x/C monolith is >40 dB at 600 degrees C, which is superior than most of the reported EM shielding materials under the same conditions. Compared with a Hf-free SiC/C monolith, the SiC/HfCxN1-x/C monolith possesses superior EM shielding performance due to the presence of a highly conductive HfCxN1-x phase. Moreover, the HfCxN1-x-particles are covered by a carbon layer forming core-shell nanoparticles connected with graphite-like carbon ribbons, which result in electrically conductive networks within the semiconducting beta-SiC matrix. In addition, the hardness, Young's modulus and flexural strength of the dense SiC/HfCxN1-x/C monolith are measured to be 29 +/- 4 GPa, 381 +/- 29 GPa and 320 +/- 25 MPa, respectively. The outstanding EM shielding performance combined with excellent mechanical properties of the dense monolithic SiC/HfCxN1-x/C nanocomposites provides a novel strategy to fabricate EM shielding materials for applications in harsh environments and/or under high mechanical load