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Indexed by:会议论文

Date of Publication:2015-01-01

Included Journals:CPCI-SSH

Page Number:117-122

Key Words:Capital Constraints; Asset Allocation; Liquidity Risk

Abstract:Through analyzing the correlation between capital constraints and asset allocation, the paper constructs an asset allocation model under capital constraints. Based on the Diamond and Dyvbid model, the paper introduces capital adequacy ratio and builds the banks' asset allocation model under the balanced liquidity risk management strategy. Results have shown that capital constraints is effective in influencing banks' asset allocation. The increase of capital adequacy requirements will encourage banks to favor more risky assets, especially loans, to gain a higher rate of return.