Abstract This paper establishes a model of currency appreciation and banking crisis by annlyzing bank balance sheet. It is concluded that under the circumstance of home currency appreciation and the banking and its customers holding considerable net foreign currency assets, currency mismatches may cause the banking crisis with home currency appreciation . Empirical test indicates that currency mismatch and insolvency index of commercial banks have positive correlation, which indicates that currency mismatch has the negative influence on the stability of Chinese commercial banks.
2012, Vol. 1 
