A Study On Home Country Supervision On China's Commercial Banks

After 30 years since China opened her gate to the world,there is still such a big gap existing between China's commercial banks and banks in developed countries on multinational operation,no matter in extending business or on branch management. Compared to domestic operating,the distinctiveness of multinational operation brings out many obstacles and challenges while China's commercial banks implement the "going global" strategy.With the development of globalization and liberalization of financial services,multinational banks' risks are rising gradually.In 2007,the sub-prime mortgage crisis broke out in the U.S.,it caused some investment losses of China's commercial banks,and meanwhile it was a wake-up call for China's multinational banks in banking supervision.According to the New Basel Agreement and international supervision experience,multinational banks and its overseas organs must be operated under a circumstance of supervision. Nowadays,China's commercial banks are getting faster on "going global",hence the multinational supervision should keep pace with commercial banks.The paper firstly gives an overview of current regulation theories and the latest development on theories about multinational regulation and supervision,then focuses on problems China's commercial banks meet while implementing overseas operation.By analyzing the issue through several different aspects and using the latest financial database and materials,a conclusion is drawn about banks' multinational operation.Further more,China's commercial banks can draw some inspiration from the sub-prime mortgage crisis.Subsequently,policy advices are provided at the end of this paper.