Study Of Chinese Commercial Banks To The Corporate Governance Mechanism

Corporate Governance is an important topic for both the academics and enterprises, as well as one of the most attractive pioneer spheres in contemporary economics and management. Finance is the core of modern economy, and commercial banking is the main body of'China's financial system. Therefore, whether the mechanism of the corporate governance of commercial banking can undergo continual improvement and perfection is the utmost important to the healthy and stable operation of the national economy. Meanwhile, commercial banking is an industry with complex risk system, which determines the specialty of the mechanism of the governance of commercial banking. And, the importance and specialty of the mechanism of governance of commercial banking has been strengthened as shown by the basic characteristics of the transformation of China. The issue of the mechanism of governance of commercial banking, whether theoretically or practically, requires a breakthrough development.The research on the mechanism of commercial banking governance of the overseas mainly focus on the specialty shown by making a comparison between commercial banks and ordinary companies, and using this as the basis for forming a basic framework of corporate governance suitable for commercial banking. The current Chinese research on corporate governance of commercial banks is still in an initial stage, for it is mostly a summary of corporate governance of commercial banks outside of China. The research on the specialty of the commercial banking corporate governance during the economic transformation of China remains inadequate, which calls for a further systematic and in-depth study and fails to provide the industry a systematic direction. The effect of the execution of commercial banking corporate governance mechanism of our country is not satisfactory. There is a long way to go for the establishment of a real commercial banking governance mechanism from superficial copy to essence acquisition, especially when there is an urgent need for changing from the technical imitation in the initial stage to the innovation of the core system in the field of corporate governance mechanism. This article tries to search for the answers for the enormous difficulties encountered in the system innovative issues of the commercial banking corporate governance.This article adopts the innovation on the core system of commercial banking corporate governance as the main line, examines the transformation process of commercial banking governance mechanism, reviews the commercial banking corporate governance during the transformation period, analyzes on the important factors of the mechanism transformation process. Through studying the reformation path of commercial banks, referring to commercial banking corporate governance theories and practical experience of both domestic and overseas banks, this article raises out the main problems existing in the governance mechanism of commercial banking in our country and offers suggestions for perfection.Conducting research on the governance mechanism of China's commercial banking, the author, with reference to the research results of the precedents, offers his own answer, among which the main and innovative analyses and viewpoints are as follows:First, Corporate governance comprises of apparent characteristics of the generation and district, but the theoretical transformation and practical execution in enterprises shows a general trend. Second, the complexity of the internal governance of the commercial banks of China and the limitation of governance outside is the main focus point and difficult point encountered in the establishment of the governance mechanism of the commercial banks. Third, Risk management of commercial banks is the core joint of the commercial banking governance mechanism and operation management. From the perspective of governance mechanism, the key for the overall risk management lies on the scientific segregation of the risk management levels for commercial banking governance mechanism. Fourth, for the continual development of the corporate governance theories, especially after the deep retrospection on the reasons for the financial tsunami, regulatory bureaus generally realize that the complexity of the internal governance of the commercial banks and the limitation of the governance outside makes commercial banks fragile in confronting risk. China Banking Regulatory Commission is more concern about the issues on the cross-industries businesses of commercial banks, capital adequacy ratio, liquidity coverage and the over drastic growth of credits. Fifth, studying the reformation path of the joint-stock commercial banks system from the historical transformation perspective, based on the formation of the governance mechanism of the joint-stock commercial banks, this article innovatively divides the reformation of the joint-stock commercial banking system into four stages, with different emphasis on the corporate governance mechanism formation for commercial banks in each stage. Sixth, from the perspective of economics, from the development process of the corporate governance mechanism of the joint stock commercial banks, four characteristics are mainly illustrated. Seventh, Capital is the foundation for the perfection for commercial banking governance mechanism, running capital by making use of marketing tools is an important way for perfecting the outside limitation of corporate governance mechanism. Eighth, Expertise wisdom is also important to the elevation of commercial banking governance mechanism, whose function is mainly shown in the transformation of the human resources systems. Ninth, governance mechanisms outside commercial banks include industry monitor, government regulatory, protection and monitor of the stakeholders, product market, managers market, controlling power markets and etc. Tenth, the internal governance mechanism of commercial bank affects the effectiveness and healthiness of the fundamental operation mechanism of the commercial banks. Eleventh, in respect of the problem of the relationship between commercial banking governance mechanism and performance, through real case analysis, this article shows that the proportion of the stock held by the biggest shareholder performs an obvious positive function to the banks' performance, but over-concentration of the stock is not good for the improvement of the banks'performance, the number of the independent director also performs a positive function to the banks'performance. Commercial banks should work towards this direction to perfect their governance mechanism. Twelfth, the perfected corporate governance mechanism is an important guarantee for commercial banks improving their core competitive ability; further perfecting China's commercial banking corporate governance mechanism is as an arrow on the straining cord. To realize this target path we must choose and insist on five principles.