A Study On Risks Of Personal Financing Business Of Commercial Banks

With the promotion of the reform in banking system of China, financial industry is opened progressively; the commercial banks of our country are facing the keen competition of the foreign banks. In the meantime, due to the constant decrease of interest difference between deposit and loan, the earning ratio of the domestic traditional asset-liabilities business of commercial bank drops continuously, the domestic banks must seek new growth point of profit. In order to expand the new profit source, the commercial banks of our country are taking the development experience of the foreign banks for reference. They are expanding intermediate business especially personal financing service for customers. The experience of the foreign banks also indicates that the profit contribution rate of personal financing is higher, and it can consolidate and expand the market share.As the demand side of personal financing management market, the residents have very great enthusiasm too. With the development of economy and resident's increase of the wealth, residents have already been unsatisfied with traditional way of assets value keeping, the demand for professional financing is strengthened. Therefore, with the enhancement of fast increase of resident's wealth and personal investment consciousness, the business of personal financing management of commercial banks of our country is demonstrated enormous. The financing service of the high-quality customers has already become the competition focus of every large domestic and international bank. After the foreign banks enter Chinese financial market, they all focus on the business of advanced customer's personal financing management. Regarding domestic advanced rich customers as the target consumer group, the domestic commercial banks face the severe test.However, due to the restrictions such as the legal system of the finance, financial management system and development of financial market, etc., the development of personal financing business will meet a lot of new problems unavoidably. To study how to deal with these problems, improve risks management system of commercial bank, improve the skill of personal financing business management, strengthen the supervision of personal financing business, is the foundation to guarantee that the commercial bank personal financing business healthy, orderly. And it has great realistic meanings to promoting personal financing business.This article combines theory with practice and compares the present status of our country with international situation etc. and makes some research on the risk problem of personal financing business, including the following contents:In part one, the article introduces the general theoretical foundation of personal financing business management, including the definition and classification of personal financing business and economic and financial theory: Life period hypothesis, traditional investment theory, CAPM, and various behavioral financial theories. And it has analyzed the application of these theories in personal financing business respectively.In part two, this article introduces the background and current situation of the development of personal financing business, including the necessity for commercial banks to develop it, the condition possessed, and some existing problems at present.In part three, the article mainly analyzes the various risks that commercial banks face in personal financing business, mainly including legal risk, reputation risk, interest rate risk, exchange rate risk and operation risk.In part four, on the basis of part three, the article takes U.S.A. and Hong Kong as examples, introduces the situation of developed country and district. And combine the situation of domestic commercial banks, it has discussed how to protect against the risks from two angles: from both supervising level and commercial bank..