Research On Financial Derivatives About Commercial Banks

Since 70 decades of last century, the operation of modern commercial banks has been changed in the new financial environment. Most of commercial banks take OBSA as their important business to make profits. Financial derivatives are the focus of large banks, because they're the base of Off Balance Sheet Activities (OBSA)'s great increase of significance and scale. After becoming the member of WTO, our commercial banks have to face the competition of advanced banks from other countries, which have modern management system and efficiency of making business. It's necessary to us for improve the level of operation about our banks. Financial derivatives are new business to our banks, so there is a chance to make progress about the ability of competition. During the development, we should pay attention to financial derivatives' merits and defects. Not only we absorb the good experience from advance banks, but also we must advance them basing on our financial market, our banks' abilities and investors. The paper explores the problem of financial derivatives' development for our commercial banks. In the first chapter, I introduce the theory of financial derivatives, such as the definition and the nature about them. In the second chapter, I show the progress about them in the world with tables. In the third chapter, I clarify the necessities of launching this business in our commercial banks. In the forth chapter, I analyze the conditions on our financial market, and give some advices about developing them. In the last chapter, I explain the risk management about the business, and suggest our banks mature the system to control risk. In a word, our commercial banks should develop the business of financial derivatives basing on the experience of other banks and the condition of our market.