The impact of earthquake risk on banks’ lending behavior: evidence from local Chinese banks

This paper examines the impact of earthquake risk on the lending behavior of local Chinese banks. The results show that when facing earthquake risk, banks will adjust their lending behavior, including decreasing the amount of loans and mortgage loans and increasing credit loans and loan loss provision, but the effect only exists for banks without inter-provincial branches or that are located in cities with a higher population density. In general, earthquake risk cannot significantly affect the performance of banks, but it can deteriorate the performance of banks that have not adjusted their lending behavior.