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

Chen, Jing; Kamarudin, Fakarudin; Amin, Bany Ariffin; Theng, Lau Wei; Zhou, Tim

doi:10.1016/j.frl.2025.107682

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

Jing Chen

, Fakarudin Kamarudin

, Bany Ariffin Amin Noordin, Lau Wei Theng, Tim Zhou

Finance Research Letters, Volume: 83, Start page: 107682

Swansea University Author: Tim Zhou

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DOI (Published version): 10.1016/j.frl.2025.107682

Abstract

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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Published in:	Finance Research Letters
ISSN:	1544-6123 1544-6131
Published:	Elsevier BV 2025
Online Access:	Check full text
URI:	https://cronfa.swan.ac.uk/Record/cronfa69621

first_indexed	2025-06-03T16:44:12Z
last_indexed	2025-06-13T13:34:10Z
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spelling	2025-06-12T12:55:46.4000213 v2 69621 2025-06-03 Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership c132216bf49e0544a968bb3919686327 0000-0002-0830-2316 Tim Zhou Tim Zhou true false 2025-06-03 CBAE 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. Journal Article Finance Research Letters 83 107682 Elsevier BV 1544-6123 1544-6131 Shadow banking; Technical efficiency; Bank ownership; Moderating effect 1 10 2025 2025-10-01 10.1016/j.frl.2025.107682 COLLEGE NANME Management School COLLEGE CODE CBAE Swansea University Another institution paid the OA fee 2025-06-12T12:55:46.4000213 2025-06-03T17:29:42.7968782 Faculty of Humanities and Social Sciences School of Management - Accounting and Finance Jing Chen 0009-0002-6757-6293 1 Fakarudin Kamarudin 0000-0001-8180-1173 2 Bany Ariffin Amin Noordin 3 Lau Wei Theng 4 Tim Zhou 0000-0002-0830-2316 5 69621__34412__bd8773e5d3354230b41ef314a77285c8.pdf Shadow Banking Chinese Bank Efficiency FRL 2025.pdf 2025-06-06T11:36:55.8226262 Output 1121120 application/pdf Accepted Manuscript true Author accepted manuscript document released under the terms of a Creative Commons CC-BY licence using the Swansea University Research Publications Policy (rights retention). true eng https://creativecommons.org/licenses/by/4.0/deed.en
title	Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership
spellingShingle	Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership Tim Zhou
title_short	Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership
title_full	Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership
title_fullStr	Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership
title_full_unstemmed	Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership
title_sort	Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership
author_id_str_mv	c132216bf49e0544a968bb3919686327
author_id_fullname_str_mv	c132216bf49e0544a968bb3919686327_***_Tim Zhou
author	Tim Zhou
author2	Jing Chen Fakarudin Kamarudin Bany Ariffin Amin Noordin Lau Wei Theng Tim Zhou
format	Journal article
container_title	Finance Research Letters
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container_start_page	107682
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doi_str_mv	10.1016/j.frl.2025.107682
publisher	Elsevier BV
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department_str	School of Management - Accounting and Finance{{{_:::_}}}Faculty of Humanities and Social Sciences{{{_:::_}}}School of Management - Accounting and Finance
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description	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.
published_date	2025-10-01T05:28:41Z
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Impact of shadow banking on Chinese banks’ efficiency: The moderating effect of ownership

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