The Research On The Comprehensive Management And Supervisory Evaluation Of China's Commercial Banks' Operational Risk

Over recent years, frequent operational risk events have caused huge loss of the commercial banks around the world, and even affect the sound operation of the banking systems in some countries. The continuously exposed banking crimes of Chinese banking institutions have fully shown that operational risk has become an important source of bank loss. Facing the fast-rising trend of the operational risk, the Basel Committee and the supervisory authorities of each country have been actively exploring the supervisory systems and methods of the operational risk. In March 2005, the China Banking Regulatory Commission issued"Notice of the CBRC on Enhancing Operational Risk Control"and assigned to crack down on banking crimes. Therefore, the research on the management and supervision of the operational risk has both theoretical and practical meaning, and it is the research purpose of this article.From the view of a regulator, this article analyzes the current situation and management level of China's operational risk and briefly introduces the relevant theories on operational risk management including the Basel Accord. Starting from the three-dimensional model of the operational risk management (studied by the research group of Zhangwei, professor of Tianjin University and Tianjin University of Finance & Economics), we propose a comprehensive operational risk management framework of commercial banks. Based on this, we excogitate a set of supervisory evaluation methods to evaluate the operational risk management of the commercial banks, including the qualitative evaluation of the operational risk management process and the quantitative evaluation of the management results. In order to validate the evaluation methods tentatively, we do a case study on one of the commercial banks in Shenzhen by analyzing its operational risk management using the above methods.