Abstract: Based on the unbalanced panel of China's 16 listed banks from 2000 to 2013, taking into account the possible cross section of spatial autocorrelation between banks, this paper used the approach of Driscoll and Kraay(1998)to test the relationship between China's commercial bank capital buffers and the economic cycle. It mainly focused on three important hypotheses. Results showed that: the capital buffers and coefficient of variation of the economic cycle fluctuation are positive, while there is a certain counter-cyclicality in capital buffers; commercial banks scale and capital buffers hold an inversely proportional relationship; the “too big to fail” theory is not applicable to China's reality; loan loss provision is not only based on the theory of profit, but also will be affected by cost theory, and the tradeoff between the two theories causes the loan loss provision coefficient to be not significantly negative.