The Enlightenment Of The Bankruptcy Of Hainan Trust Industry

Financial risk management is the core and frontier problem in modern financial theory; it is a critical and practical issue which our country is facing as well. Trusting industry is one of the four main pillars in financial industry. With the changing of our financial circumstance, the risks of trust companies facing are more and more complicated.How to well manage and control these complicated risks is a critical problem that the domestic trust companies encounter during the period of further developing. While there are still some problems in the trust companies, such as system's imperfect, organization's unsound, which not only hold back the development of the trust companies, but also make them malfunction in risk avoidance. Therefore, an analysis on these risks and management problems in China is of great theoretical and practical significance.This paper begin with concrete examples of the bankruptcy of Hainan trust industry to educe the significance of risk management, then analyze the risk performance and reasons through deep research on Hainan trust industry. At last, the author establish a frame of trust risk management, offers some suggestions about the macro strategies and micro strategies on the risk management of trust institutions.This paper is of significative for the following reasons: on the one side, it can make everybody know about the fundamental reason of bankruptcy of Hainan trust industry, and help the trust companies on the practice of risk management. On the other side, it is useful for the institution of supervise and regulation. On the micro-aspect, it will improve the ability of risk management of trust companies, while on the macro-aspect, it may supply a gap of theories' absence, so as to accelerate the development of the trust industry both in theory and of practice.