Trends In The Evolution Of Bank Capital Supervision And The Response To Our Legal System

In the movement of financial globalization, liberalization and integration, the financial system is facing the problem of the increasing risks inherent and the governments of financial supervision are undertakeing more and more challenge. As the most importment part of the financial industry, the banking industry is a special and high-risk industry.The financial crisis which brought by the failure of banking operation has a significant impact on the world economy.Capital supervision is the core of banking supervision.It is a main task to keep the capital adequacy rate match with the risk for the commercial banks. Effective supervision of banking capital has been the primary way to prevent and resolve banking risks and maintain the stability of the country's financial system. From the beginnining to the Basel Capital Accord,then the New Basel Capital Accord, the rules of banking capital supervision have undergone a continuous evolution, and still in the progress. In particular, the New Basel Capital Accord announced in June 2004 has absorbed some merits of banking capital supervision in the old principles and forms the common restriction of three pillars,which are the Minimum Capital Requirements, extern supervision and market self-discipline, which enhances the ability of bank risk supervision and represents the highest level of bank capital supervision. Presently, the banking-based capital supervision already becomes the popular trend for banking development in the world, more and more countries and areas have positively accepted the successful experience of the New Basel Capital Accord.In order to integrate the international financial markets and enhance the competitiveness of China's banking industry, China has a clearly commitment that they will supervise their commercial banks in accordance with the requirements of the Basel New Capital Accord. Therefore, we must actively respond to new trend of the banking capital supervision and analyse the existing legal system of banking capital supervision comprehensively according to the reality of China's commercial banks, to coordinate with international regulations. It has a significance to improve the corresponding legal system of supervision, reduce banking risks, enhance risk management of China's banking industry, thereby enhance the international competitiveness of China's banking industry.As can be seen from the title, I want to present the inadequancy of China's legal system through the evolution of the international banking capital supervision and future trends. Combined with the background of financial crisis, I want to propose the future development of the legal system of China's banking capital supervision. This article contents five parts:Chapterâ… is about the basic theory of bank capital supervision,including:the concepts of bank capital and bank capital supervision, the necessity and effectiveness of bank capital supervision.Chapterâ…¡is about the historical background and evolution of bank capital supervision, focusing on the capital adequacy and the Basel Capital Accord.Chapterâ…¢is about the important position of the New Basel Capital Accord and its main contents, which established the dominance in the area of bank capital regulation.Chapterâ…£is about the five stages of the legal system of China's banking capital supervision and the major legal documents, in order to present the positive response of our legal system to the evolution process of the international banking capital supervision.Chapter V is about the impact of international banking capital supervision on the New Basel Capital Accord and the emergence of new trendsbrought by the financial crisis.We need to reexamine the framework of the existing regulatory system to actively respond to this new trend.