Research On Risk Limit Management Of Commercial Bank

With the global financial risks increasingly widespread, complex and changeable, the banking industry urgently needs to establish a more precise and practical mode of management to control the loss of risk, so limit management emerges. Through the risk measurement and portfolio analysis, the bank sets the maximum limits for various products and transactions. The various limits link and constraint with each other. They play the role of constraint, decentralizing and early-warning in the risk management and form an organic limit management system.Risk limit management includes setting, allocating and controlling the risk limit. Firstly, on the basis of value at risk and the actual situation in China, the paper separately discusses the measure methods of the market risk, credit risk and operational risk to set the risk limit. Then, according to the risk adjusted return on capital it researches the allocation of risk limit of the bank's capital. Finally, it monitors the risk limit though collecting the rational controlling time.The commercial bank's risk limit management system is built on the risk measurement and portfolio analysis. It includes credit risk, market risk and operational risk. It reflects the bank's operating strategy, policy guidance and the allocation of capital. It represents the professional, precise and systematic development direction of the current risk management. Establish the data integrated storage solutions, enhance the development and application of risk measure model and establish the overall IT service management solutions to construct the commercial banks' risk limit management system from the planning stage, the system construction phase and the implementation phase.