The DOI matches its Crossref record.
How Banks in China make Lending Decisions
Abstract
Based on interviews conducted in four major Chinese cities, this paper examines the determinants of lending by state-owned commercial banks (SOCBs) to manufacturing firms in China. The conventional relationship banking and transaction lending theories helps explain at least part of the lender–borrower relationship in China. The perceived lending bias against non-state-owned enterprises could actually be reconciled as rational decision-making by SOCBs, partly due to the higher risk involved and/or high transaction costs in the risk evaluation of such lending. The existence of unofficial lending criteria at SOCBs nonetheless provides golden rent-seeking opportunities for unscrupulous bankers to exploit the regulatory loopholes for financial gain.
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Digital financial inclusion and quality of economic growth
Xi, W., & Wang, Y. (2023) · Heliyon · doi:10.1016/j.heliyon.2023.e19731 · Cited by 76
“Existing research widely acknowledges that information asymmetry and high transaction costs are significant obstacles impeding the ability of traditional finance to foster economic development [54 – 56].”
Metadata
- Authors
- Yeung, G.
- Corresponding author
- Yeung, Godfrey
- ORCID
- Yeung, Godfrey
- Venue
- Journal of Contemporary China
- Publisher
- Informa UK Limited
- Published
- 2009-03
- Volume
- 18
- Issue
- 59
- Pages
- 285-302
- ISSN
- 1067-0564 (ISSN-L)
- 1469-9400
- OpenAlex
- W1997316900
- Cited by
- 57
- References
- 0
- Citations by year
- 2026: 1 · 2025: 1 · 2024: 2 · 2023: 5 · 2022: 2 · 2021: 2 · 2020: 5 · 2019: 2 · 2018: 6 · 2017: 2 · 2016: 7 · 2015: 6 · 2014: 2 · 2013: 7 · 2012: 1
- FWCI
- 3.95
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- Journal of Contemporary China (publishedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Finance › Banking stability, regulation, efficiency
- Social Sciences › Political Science and International Relations › China's Socioeconomic Reforms and Governance
- Social Sciences › Business, Management and Accounting › Strategy and Management › Political Influence and Corporate Strategies
- Keywords
- bank lending decisions, state-owned commercial banks, relationship banking, manufacturing companies, non-state-owned enterprises, credit risk, transaction costs, rent-seeking, Chinese banking sector
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Cite CoChat for the checks on this page, and the paper for its own findings.
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- CoChat. (2026). Citation check: How Banks in China make Lending Decisions. https://app.cochat.ai/papers/10.1080/10670560802576034
- The paper
- Yeung, G. (2009). How Banks in China make Lending Decisions. Journal of Contemporary China. https://doi.org/10.1080/10670560802576034
