The Research On Capital Allocation Of Commercial Bank

For a long time, commercial banks of China have witnessed administrative intervention, and insufficient capital allocation awareness. The commercial banks of China should gradually realize to use scarce capital scientifically and rationally which is expected to offset the loss of non-economic capital. However, since the capital allocation management started late, the study on matured international capital allocation method is still in the introduction stage and fails to give adequate consideration of the applicability of the methods in China.First, this dissertation begins with the economical capital concept and theory relative to economical capital allocation, and introduces the economical capital distribution model - RAROC which optimizes the commercial banks capital distribution frame and the process. The principle of economic capital allocation is under the overall planning for capital scale growth, in accordance with capital's constraint on risk assets growth and the return on capital requirements, a reasonable economic capital growth targets is determined. Economic capital is distributed rationally and effectively in all sectors, all businesses and all assets, which finally matches the development of banking business with the capital adequacy level. Economic capital allocation methods have advantages and disadvantages, among which RAROC method can connect banking risks with the bank value closer and the distribution effect is better. Second, considering problems existing in capital distribution in commercial banks, for example, Capital distribution method and distribution frame, and offers some measures. Then, commercial banks distribute economic capital based on risk relevance and establish the most optimized capital disposition model under the dual-restraint of the risk and the profit. Meanwhile, capital distribution model is analyzed through examples. Finally, this dissertation post-evaluates and adjusts economic capital optimization of commercial banks and solves the problems of economic capital optimization distribution.