| With the evolution of the Basel agreement,Regulatory authorities strengthened the supervision of International Banking,especially New Basel Capital Accord issued in 2004 adhered to capital adequacy ratio at the core of the regulatory ideas of the Basel Accord in 1988.At the same time it defined The three pillars of the minimum capital requirements,supervision of inspection authorities,Market constraints disclosure of information as the core.Refer to experience of supervision international banking, China Banking Regulatory Commission Issued a "capital adequacy ratio of commercial bank management" (referred to as "the way") in 2004,improved and strengthened the capital of China's banking supervision, Capital adequacy ratio became "hard constraint"of China's banks' development.As can be seen,Capital regulation has become the core content of World Bank supervision of the regulatory authorities of the commercial banks for prudential regulation. The implementation of capital control system has brought about a substantial impact to China's Commercial Banks from concept to practice. Ample capital has become China's commercial banks'prerequisite to survive and develop. On the other hand, by the end of 2006, China's full liberalization of the financial sector gave foreign banks give "national treatment", realized Chinese'commitments of becoming the member of WTO.So China's banking faced with increased competition; Third, as the U.S. sub-loan crisis spread, China's commercial banks are also faced with the danger of shrinking assets because of the impact of the financial tsunami. Timely replenishment of capital, improve the capital adequacy ratio are the most important task for banks which security and stable development of bank in the future.Subordinated Debt as a kind of commercial bank debts in the proactive form is widely recognized by the international banking sector in recent years to the sound operation and sustainable development of Commercial banks, and even have played an active role in the reconstruction of the country's which attacked by the financial crisis.As the order of repayment of principal and interest of Subordinated Debt after,general liabilities before,also with long term, Operating losses for the banks to provide a buffer force,it has some characteristics of equity. Basel Capital Accord therefore have certain Subordinated Debt with certain conditions as the subsidiary capital. This change in China's commercial banks has long been one of the capital structure, to broaden the financing channels for capital to raise the overall level of capital adequacy ratio to meet the requirements of regulatory authorities to meet the challenge of foreign banks to deal with the impact of global financial tsunami is, after all, a effective way.This article discusses the Subordinated Debt which is also a relatively new financing tool for supplementary capital as a subsidiary of the way in our country. Chapter 1 of the article first by analyzing the importance of bank capital and the international banking sector to strengthen supervision of capital, which leads to In order to meet the financial globalization in China has also strengthened its supervision of capital, however, the capital of China's relatively advanced countries there is still a certain gap, analyzing the supplementary capital of China's commercial banks of channels on the basis of analyzing the current situation of China's capital. By comparing the present stage of China's commercial banks to add capital (including the core capital and subsidiary capital) of the potential channels: Financial capital injection retain profits, while the private share of capital, issuing shares, issuing long-term subordinated debt, Subordinated Debt as a supplement to draw commercial bank subsidiary capital innovative approach is a quick and sustainable way to add capital. Chapter 2 leads on the issue of Subordinated Debt Analysis.Chapter 2 introduces the meaning of subordinated bonds, characteristics, including the conditions included in subsidiary capital, followed by commercial banks on capital management theory, Active liability theory, financial innovation theory and the issuance of Subordinated Debt; In the basis of theoretical support, but also cited the sub-bond pricing model, By comparing the domestic and foreign commercial banks to issue subordinated situation, summed up China's commercial banks to issue subordinated products in the way of the issue size and characteristics of the period, Chapter 3 leads on the analysis of effect of the issuance of Subordinated Debt.Chapter 3 introduced first commercial banks to issue subordinated bonds of the positive effects. To enhance the level of capital adequacy ratio to meet regulatory requirements, and enhance the bank's ability to resist risks of commercial banks which is the main purpose of Subordinated Debt Issue, In addition, commercial banks can also take the initiative to enhance the debt capacity, to enhance the level of asset-liability management ,to improve the yield of the bank's shareholders ,to enhance the bank the value of the bond market also will help improve and strengthen the function of the market constraints, For investors, can also broaden the investment channels. However, sub-debt is a double-edged sword, issuing subordinated bonds also have some negative effect, It would be to increase the cost of long-term debt of banks. And inter-bank bond holders of Subordinated Debt would lead to inflated banking capital. In the long term, over-exaggerated the role of sub-debt may affect the bank's long-term, stable development, to investors of the investment will also pose potential risks. In view of the analysis of subordinated debt issuedof China's commercial banks for the use of sub-debt capital is in the initial stage,China's commercial banks Should give full play to the positive role of subordinated bonds to avoid its negative effects, Chapter 3 leads on analysis of Subordinated Debt to play a reasonable advantage.Based on the above analysis, Chapter 4 proposed a reasonable sub-play Suggestions bond strengths, First of all, that is to the scientific design of subordinated bonds to the issue and circulation of the market, standardization and learn from the advanced experience of foreign countries in accordance with the standardization, the market requirements and continuously improve the scientific pricing system, the design of a variety of bond trading varieties, of course, Considering financial environment home and abroad to design both highly advanced and practical products of the Subordinated Debt,in order to achieve the purpose of issuing subordinated bonds. Second, the regulatory authorities, the commercial banks should be strictly limited to between the proportion of holders of Subordinated Debt in order to avoid excessive cross-inter-bank holders of Subordinated Debt due to a result of systemic risk; Third, it is necessary to improve the bank sub-debt information disclosure mechanism to enhance the transparency of distribution and circulation, strengthen the capacity of market constraints; Fourth, the current credit environment in general poor, weak basis for social credit, but also the need to constantly improve the credit rating system in order to protect the interests of investors, In addition, actively nurture and grow the ranks of institutional investors in order to promote the health of China's bond market, and orderly development. Through the above efforts, and give full play the positive role of secondary bonds, in particular the advantage of added capital to improve the overall capital of China's banking industry level, in response to competition with foreign banks and financial impact of the tsunami, access to long-term stability development. |
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