This study examines how foreign equity participation affect risk-taking of commercial banks using Chinese bank-level data from 2012-2020. Our analysis is based on strategic alliance theory and principal-agent theory, and we find that banks with foreign equity participation exhibit a significantly lower risk-taking compared to those without foreign equity participation, and this finding is shown to be consistent in a series of robustness tests. Additional analysis shows that equity checks and balances reinforce this negative relationship. Furthermore, we document that the incidence of such effects is more pronounced for Chinese banks which are smaller and less based on income diversification. Our results suggest that the proportion of foreign equity participation should be moderately increased to form equity checks and balances.