China's State-owned Commercial Banks' Liquidity Management

A bank is a kind of special enterprise with high liability operations, whose uncertain debt and compulsory restriction require a stronger liquidity of bank assets. As a result, liquidity management becomes the first task and the core objective of the bank management. Though the commercial banks of our country are still not commercial banks in the real sense, the regulations on the ratios of assets and liabilities that the People's Bank of China issued in 1994 indicate the commercial banks of our country carry out the management of assets and liabilities ratios, and the liquidity management is brought into schedule. But does the west classical asset-liability management theory equate with the liquidity management? What's the difference between the developing stages of the liquidity management in the state-run commercial banks of our country and those in the west? What are the reasons that the state-run commercial banks of our country lack the overall and effective liquidity management? What internal and external conditions need to be created if the overall and effective liquidity management is set up? The solutions to these problems are exactly the purpose of writing this paper.This paper points out in the preface that with the cancellation of the volume of credit in recent years, the rapid development of the money market (the inter-bank bid market and the bond market), and the enlargement of the discounting business of the note, the liquidity management of the state-run commercial banks of our country has entered a new stage of development. But we should realize that the liquidity management of the state-run commercial banks of our country is still far from mature, the liquidity management implemented at the present stage still fails to well impel the commercial banks to set about managing from the two respects of assets and debts, which is unfavorable to the sound management and the precaution of liquidity risk of the state-run commercial banks of our country.The paper is divided into three chapters:In the first chapter, the basic theories of the commercial banks' liquidity management are introduced, which lay a good theoretical foundation for the further investigation into the liquidity management problem of our state-run commercial banks. This chapter is divided into three parts:The first part, from the fund supply and demand angle of the commercial banks, discloses the intension of the liquidity management, and analyzes a series of indexes of weighing the liquidity state in an all-round way in order to understand liquidity intension further.The second part analyzes three stages of western asset-liability management theory development, namely asset management theory, liability management theory and asset-liability comprehensive management theory in an all-round way. And it has expounded the difference and the relationship between the asset-liability theory and liquidity management theory, and points out that the asset-liability management theory includes the liquidity management, capital reservation management, investment management, loan management, interest rate risk management, setting-up of the financial product pricing mechanism of the bank, etc., and this paper is based on the explanation of the development of the western asset-liability management theory in terms of the liquidity management.The third part carries on in-depth analysis of the necessity of liquidity management in terms of liquidity risk theory and instance, which offers a better theoretical foundation for analyzing liquidity management further. In the second chapter, the state of development of liquidity management of the state-run commercial banks of our country is explained in an all-round way, which establishes the foundation of further analyzing that liquidity management is not enough. This chapter is divided into four parts:The first part reviews the liquidity management development courses of our state-run commercial banks in brief.The second part, on the basis of enormous statistics, takes four maj...