Banks-firms credit network in China

In this paper, using a proprietary loan data for 17 national-wide banks, we construct the banks-firms credit network and the projected co-financing banks' network in China. With the network tools, we are able to investigate the underlying topology and structure of Chinese credit relationships. Our results show that (i) State-owned commercial banks are the hubs of the network. (ii) While the market share of public-owned commercial banks increases quickly in recent years, core firms are still focused on state-owned commercial banks for financing. (iii) Multiple banking is very infrequent; most of the firms just borrow from one or two banks. (iv) Multiple banking is highly correlated with firms' total assets and age. (v) All of the state-owned commercial banks and public-owned commercial banks are connected with each other. (vi) The spanning-tree is very simple, just one state-owned commercial bank lies in the centre. (vii) Most of the defaulted firms just defaulted in one bank and there are not many common defaulted firms between each pair of banks.