Variable description
| Variables | Description/measurement | Data source |
|---|---|---|
| Dependent variable | ||
| Loan price | Equals the annual ratio of interest income to gross loans for each bank (%) | Bloomberg |
| Main independent variable | ||
| EPU | An EPU index developed by Baker et al. (2016) that tracks policy-related economic uncertainty using data from the South China Morning Post (SCMP). The index frequency is monthly, and for our main analysis, we use the median EPU value for each year | Baker et al. (2016) https://policyuncertainty.com/ |
| Inflation | Equals the annual percentage change in consumer prices in China (%) | World development indicators database, world bank |
| Independent control variables | ||
| Interest expense to liabilities | Equals the annual ratio of interest expense to total liabilities for each bank (%) | Bloomberg |
| Equity to assets | Equals the annual ratio of total equity to total assets for each bank (%) | Bloomberg |
| Non-interest expenses to assets | Equals the annual ratio of non-interest expenses to total assets for each bank (%) | Bloomberg |
| LLP to gross loans | Equals the ratio of loan loss provision to gross loans for each bank (%) | Bloomberg |
| Loan to deposits | Equals the ratio of gross loans to total deposits (%) | Bloomberg |
| Bank size | Equals the natural logarithm of the annual total assets of each bank (US$) | Bloomberg |
| GDP growth | Equals the year-on-year annual GDP growth rate for China | World development indicators database, world bank |
| Variables | Description/measurement | Data source |
|---|---|---|
| Loan price | Equals the annual ratio of interest income to gross loans for each bank (%) | Bloomberg |
| EPU | An EPU index developed by | |
| Inflation | Equals the annual percentage change in consumer prices in China (%) | World development indicators database, world bank |
| Interest expense to liabilities | Equals the annual ratio of interest expense to total liabilities for each bank (%) | Bloomberg |
| Equity to assets | Equals the annual ratio of total equity to total assets for each bank (%) | Bloomberg |
| Non-interest expenses to assets | Equals the annual ratio of non-interest expenses to total assets for each bank (%) | Bloomberg |
| LLP to gross loans | Equals the ratio of loan loss provision to gross loans for each bank (%) | Bloomberg |
| Loan to deposits | Equals the ratio of gross loans to total deposits (%) | Bloomberg |
| Bank size | Equals the natural logarithm of the annual total assets of each bank (US$) | Bloomberg |
| GDP growth | Equals the year-on-year annual GDP growth rate for China | World development indicators database, world bank |
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