The Interest Rate Market Influence And Countermeasures Of China Merchants Bank

Interest rate liberalization is one of the main issues for currentChinese financial reform. Banking sector environment will change withthe interest rate liberalization, which help banks implement their ownreforms to meet the financial globalization. The liberalization willdefinitely have a significant impact on the banking sector environmentand management. How to handle the new liberalization situation andimprove interest rate risk management have become the core issues ofChinese banks' survival in coming open-up.According to the successful and failure experiences worldwide,interest rate is a very complicated and comprehensive system withfar-and-broad reaching impact. As the key element of financial system,commercial banks are subject to the impact and potential risks. Based onthe practice of China Merchants Bank, this paper analyzes the impact ofinterest rate liberalization on CMB's operation management, businessdevelopment and profit-gaining capability. Also by taking advantage ofthe leading international management model, this paper explores theprinciples that CMB is to deal with the interest rate reform.This paper will give an in-depth research and analysis on theseissues, and propose several constructive suggestions through sometheoretical models based on the international practices on interest rateliberalization. Proposed strategies, including interest rate riskmanagement strategy, pricing strategy, structure-reorganizing strategy will be illustrated after analyzing to provide some decision basis formanagement of China Merchants Bank.