Empirical study reveals population aging increases risk-taking in commercial banks, suggesting demographic shifts undermine financial stability.
This study investigates the impact of population aging on the risk-taking behavior of Chinese commercial banks and explores its underlying mechanisms. Using micro data from 403 commercial banks in China from 2007 to 2023, we find aging significantly increases banks’ risk-taking levels. Further analysis suggests that deposit–loan imbalances, the expansion of non-loan investments, and deteriorating asset quality are closely associated with population aging and further contribute to higher bank risk-taking. Moreover, the effect of population aging is more pronounced among rural banks and tends to be stronger in the central and western regions than in the eastern region.
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Zhang et al. (2026) studied this question.
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