Research reveals a significant increase in loan-to-deposit ratio with higher tertiary industry share, indicating financial stability implications.
With the rapid development and structural transformation of the global economy, the importance of the tertiary industry in national economies has become increasingly prominent. As the core of Chinas financial system, commercial banks loan-to-deposit ratio (LDR) is a key indicator reflecting the stability of financial markets and the health of economic development. This paper investigates the influence of the value-added share of the tertiary industry on the loan-to-deposit ratio of banks from both provincial and micro-level perspectives. Empirical analysis and regression results indicate that an increase in the proportion of the tertiary industry significantly raises the LDR. Furthermore, this study explores the underlying mechanisms through which the tertiary industry proportion affects the LDR, clarifying the transmission pathways.
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Ke Yu (2025) studied this question.
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