Negative interest rate, Risk behaviors and Bank heterogeneity--Based on the European Banking Industry

• 1、School of Economics and Business Administration, Chongqing University,Chongqing,400044
• 2、China People 's University School of Finance and Economics，Beijing，100872

Abstract：In the context of long-term low interest rates with quantitative easing monetary policy implementation effect is gradually reduced, some European countries try to implement negative interest rate policy in the central bank's reserve deposits. The European banking data of negative interest rates, microscopic characteristics of bank risk behaviors were investigated. Results showed that negative interest rate policy in the euro zone have increased the risk of the bank, and significantly reduce the Swiss bank's risk level. Considering the microscopic characteristics of banks, large banks, with negative interest rates can reduce the risk level of the banks in Sweden. Banks with high capital adequacy ratio, low level of liquidity, negative interest rates can reduce the risk level in the euro zone. Under the low capital adequacy ratio, high level of liquidity circumstances, negative interest rates can reduce the risk level of banks in Denmark.

Keywords： Negative interest rate Risk behaviors Bank heterogeneity