China's Commercial Banks In The Interest Rate Market Interest Rate Risk Prevention

After entrying into WTO, our country the financial industry opened into the new period outward, the financial industry will melt into the financial service in world competition, in opened economy & financial environment, our country the commercial bank will launch with foreign commercial bank directly ,the competition of the distance of zero, west nation basic realizes up the interest rate marketlization, commercial bank all pass by the baptism that interest rate marketlization.Our country is nation that objective request that an interest rate control, the interest rate system less and less adapts to the economic marketlization, the integral whole turns with internationalize, being used as the financial liberalism most key, most core of the reformation of the interest rate marketlization has been urgent. Along with the reform of interest rate marketlization, the fluctuation of domestic interest rates become more and more frequently. The interest rate risk is becoming the main risk for the commercial banks in our country, and the management of the interest rate risk is becoming the main task for the commercial banks.The interest rate risk management of the commercial bank in our country remains on a relatively low level due to many reasons including the strict interest rate control system and the less developed corporate governance structure of the commercial banks. The top of the whole still lacks the experience that against the interest rate risk with the means, wether on the theories knowledge, or on the experience backlog, It is hard to adapt to the reformation in a short time .Therefore, under the new situation, new surrounding, enhancing our country commercial bank interest rate risk against with manage the level is very urgent, how to prevent & manage the interest rate risk of commercial bank is one of the important problems urgently to study.Since 1970's, the financial liberalism that the interest rate marketlization is the main contents caused a deep change in the financial realm of the world. Western countries realized the reformation of the interest rate marketlization through relieving control on the interest rate,which causing the enormous interest rate risk faced by the western banking.forcing the banking enhances to prevent the interest rate risk, with the continuous research of several decades , the techniques that the banking prevent theinterest rate risk become mature graduely.coming up with many effective systems for interest risk management. In Sept 1997 the Basel committee issued "the Guidance Principle of Interest Rate Risk Management", which bring forward instructions for interest risk management of commercial banks. Now, compared with their peers in developing countries, Western commercial banks dominate in a lot of aspects, such as the collection of data, the exploitation of software, the training of personnel, and the circumstance of market. Their advanced technique of interest risk prevention & management is worthwhile for us to learn.Based on the situation of our country and foreign advanced theories and experience, My paper start with the interest rate marketlization in our country, and then discuss the issue of interest rate risk prevention & management for the commercial bank in our country. Under the Chinese characteristic socialism market economy term, inquirying into the valid measures that the commercial bank prevent & manage the interest rate risk, which has important practical value for our country commercial bank to improve management and guarantee the safety with stabiliziation of the commercial bank but also has the important theorical value to fullfill and develop the financial theories in socialism.There are four chapters in my paper.In Chapter one I specified interest rate risk and the cause of interest rate risk of the commercial banks in our country.firstly I viewed the interest rate marketlization in our country, then I specified the related definitions, interest rate risk.lastly I specified interest rate risk and the cause of interest rate risk of the commercial banks in our countryIn chapter two, I specified the situation of the interest rate risk prevention for commercial bank in our country of the present stage. In this chapter fistly I expatiated the significance and urgency of the interest risk management .secondly I definitude the market circumstance that the commercial banks in our country faced to in their the interest rate risk management, and the weakness of our commercial banks' interest rate risk management.In chapter three, I researched how to assess the interest risk of commercial banks in our country. I concentrated on three methods, which are the Interest Rate Sensitive Gap...