In reduced form framework,the paper analyzes the risk,which lies in the reciprocal subordinated bond holdings by banks,both qualitatively and quantitatively.And we investigate its influence on capital adequacy,default probability and credit spread.We show that,on one hand,the capital adequacy of banks is improved by reciprocal holding behavior,and the credit spreads of new issued bonds are reduced when recovery rate is higher than a given level;on the other hand,the default contagion risk induce...