A Research On Multiplex Financing Pattern Of The Chinese Corporate Commercial Banks Under Capital Restraint

In recent years, one of the discussed key matters with the international commercial banks is still financing problems. The reasons why the commercial banks raising capital consist in: Firstly, a commercial bank routine work demands the capital resembling in the business enterprises. Secondly, the financing action is the premise of the operating and management of the commercial banks, it is essential to choose the most suitable capital construction so that the commercial bank pursues the maximum of its value before making decision of its investment. Thirdly, under the frame of the modern capital regulation, a modern commercial bank has to pioneer and develop the multiplex financing channels to raise and keep ample capital for the sake of extending its business and strengthening its ability in resisting risks and for market competence. Among them financing for satisfying the regulation capital restrain is the most urgently and realistic mission for the modern commercial banks.The multiplex financing source and adequate capital is the initial premise in the financial system in one country to prevent the unsteadiness. Commercial banks, which undertake the high debt at all times are the special business enterprise to operate the currency and credit. What is more, under parts of reserves system, the frangibility and un-stability of the commercial bank is inherence. Commercial bank is more frangible than common business enterprise, the risks among commercial banks are easier to be infected. The Basel Capital Accord (1988) came into being to lower down the risk and un-stability of the international banking, to establish the running mechanism under which the international banking competing equitably, to unify the capital composing of the international commercial banking, and to constitute unifying standard of regulationabout the capital adequacy rate of the international banking.As the uniform rules of the game of the international banking, the Basel Capital Accord (1988) unified the definition of the bank capital and the international standard of the capital adequacy, which has produced the profound influence on the international banks regulation, the commercial banks risk management and the management ideas, even been acted as the international standard of the modern commercial banks' capital system. It has been developing continuously in dispute. After the 90's of the 20th centuries, along with the complicated degree deepening continuously in bank management and the technology of its risk management being improved, the Basel Capital Accord (1988) has lagged more behind the risk regulation's demand. On June the 26th in 2004, the New Basel Accord appeared finally.As soon as the transition period of China's entry into WTO is over, and the reformation of Chinese financial industry moving forward deeply, Chinese commercial banks will confront with the challenge to participate the international fair competition and to internationalize urgently. Therefore, China has quickened steps to adopt the international rules in the aspect of the capital regulation of the commercial banks, China Banking Regulatory Commission (CBRC) using the reference of the regulatory frame of the Basel Capital Accord, and the New Basel Accord promulgating the Supervising measures to Capital Adequacy rate of the commercial banks in the Mar, 2004. The Supervising measures provide prudent criterion to the Capital Adequacy rate of the commercial banks in China, and establish the statutes base as the multiplex financing channel to raise and keep ample capital. At the same time, it becomes the guarantee for the state to regulate the banks by law. From now on, China began to span a new stage following the norm at the aspect of the commercial banks capital regulation.Currently, Chinese banks are suffering from the trouble of the shortage of capital, whose "falling short of lack money" has become oneof the most popular topic in economic realms in the country. Even if evaluated by the caliber of the new Capital regulation, and the CAR of the main financial institutions of the banks for 8%, the regulatory base line, the Capital shortage among the banks will still be over 2400 billion Chinese Yuan or so. And, in China, the capital construction is simplex, the capital elements are not reasonable, total amount of the risk asset is too big, the profitability is not strong, the channel of the capital complement is simplex, which cause the CAR low in whole, and can not reach the request of the international regulatory capital standard, and so weaken the commercial banks competence in the world market. Additionally, the Chinese commercial banks over-emphasize to increase the total assets and to extend their branch organizations, either in scale or in expenses, which cause the CAR lower in the international banking.Therefore, improving the capital management and exploiting multiplex financing channels to complement capital for the Chinese banks persistently have become the first-class and big problem of the Chinese banking. Accordingly, the multiplex financing pattern under of the modern commercial bank the regulatory capital restraint has become a strategic question for discussion, which Chinese financial industry should face to, and has the very important meaning for Chinese commercial bank to operate and manage in whole and the safety of the Chinese financial system.The literature of the commercial bank financing pattern regarded as a whole unitary object are few, even blank at the Chinese financial academic realm, of which mainly is emphasized particularly on a certain special topic such as financing through listings subordinated debt or by introducing into strategy investor etc.. Therefore, there is necessity to carry through systemic study on the commercial bank financing pattern looked upon an integrated unit by us.This dissertation regards the commercial bank financing pattern as the study object, through arranging the financing theories and the capitalconstruction theories by the numbers, analyzing the Basel Capital Accord (1988), the New Basel Accord, as the uniform rules of the game of the international banking, and the Supervising measures to Capital Adequacy rate of the Chinese commercial banks comparatively, it induced the question of financing and financing pattern of the commercial bank ,one special business enterprise, Then, which is regarded as the springboard, this dissertation contrasts to analyze the Chinese and Foreign commercial bank financing pattern, educes the three stages financing theory of our commercial banking during the developing periods, and inquiries many financing countermeasures and a few pieces of advice to satisfy the regulatory capital restraint for the Chinese banking having to face the international market.The literature of the commercial bank financing pattern regarded as a whole unitary object are few, even blank at the Chinese financial academic realm, of which mainly is emphasized particularly on a certain special topic such as financing through listings subordinated debt or by introducing into strategy investor etc.. Therefore, there is necessity to carry through systemic study on the commercial bank financing pattern looked upon an integrated unit by us.This dissertation regards the commercial bank financing pattern as the study object, through arranging the financing theories and the capital construction theories by the numbers, analyzing the Basel Capital Accord (1988), the New Basel Accord, as the uniform rules of the game of the international banking, and the Supervising measures to Capital Adequacy rate of the Chinese commercial banks comparatively, it induced the question of financing and financing pattern of the commercial bank , one special business enterprise, Then, which is regarded as the springboard, this dissertation contrasts to analyze the Chinese and Foreign commercial bank financing pattern, educes the three stages financing theory of our commercial banking during the developing periods, and inquiries many financing countermeasures and a few pieces of advice to satisfy theregulatory capital restraint for the Chinese banking having to face the international market.The contents of this dissertation consist of several aspects such as the below primarily. 1. The literature overviews. 2. Comparing Chinese Supervising measures with the uniform rules of the game of the international banking. 3. Contrasting the Chinese capital system and structure of the banking to them of the foreign. 4. Discussing the financing pattern of the American banking. 5. Discussing the developing course of the financing pattern of the Chinese banking and its character systematically. 6. Conceiving the financing pattern of the Chinese banking that satisfies the regulatory capital restraint. 7. Putting forward the counter-plan and several suggestions, which are suitable the Chinese situations and operational for the Chinese banking.The innovation of the dissertation includes several aspects such as the below. 1. Put forward the complete concept of the Chinese commercial banks financing pattern and the integrated theory of financing, and contrive one best financing pattern, which supplements and improves the application research and the theories that makes Chinese commercial banks mightiness. 2. Comparing the capital structure and the CAR of the commercial banks on the mainland with them of the ones in Hongkong, and to demonstrate them through the quantity analysis. 3. Put forward the circulating financing theory on the base of the Employee Stock Ownership Programs(ESOPs) and demonstrate Warrant financing through the quantity analysis. 4. Putting forward the counter-plan and several suggestions, which are suitable the Chinese situations and operational for the Chinese banking etc..The main conclusion and conceiving of the dissertation include. Commercial banks financing pattern differ from the general industry and business enterprises, Commercial bank makeup (core capital and subsidiary capital) and the definition are educed from the regulatory capital. Our commercial banks financing patterns are distinguished kindssuch as the planned economy system pattern, the transition economy system pattern and the market economy system pattern. Commercial banks financing includes core capital financing and subsidiary capital ones, among which the circulating financing is very important for our commercial banks at present, to develop high tier- II financing instruments has special meaning for our commercial banks in the future.