On The Improvement Of The Legal System Of China's Commercial Banks To Bankruptcy

A commercial bank is a corporate with financing as its main business scope and profit-earning as its purpose. Because of the development of direct finance along with increasing trend of mix operation, Traditional banking business is confronted with narrowing of interest rate spreads and sharp competition within and outside of the trade. As a result, the mismanagement and insolvency of the bank is inevitable. On one hand, to wind up the banks suffering from mismanagement plays a positive role in wholly improving management competence and strengthening the competitiveness of the banking trade. On the other hand, with serving as the core of debit and credit and capital transfer, the commercial bank is extremely important in promoting economic development, maintaining payment and settlement of capital and supporting social stability. In view of that, both governments and monitoring bodies in the world take a considerably cautious attitude towards the insolvency of the commercial bank, they don't directly take the way of 'insolvency' to deal with the commercial bank with existing problems, but use precautionary measures including insolvency compromise and insolvency reorganization to save it. only when these measures can't extricate the commercial bank from a predicament, they let it enter the procedure of liquidation and finally withdraw from the competitive market. The commercial bank law of our country has made the general regulations to the insolvency of the commercial bank, the new insolvency law has also listed the insolvency of the commercial bank in its range, at the same time, authorized the State Council to make the implementing method. But because of the particularities of the commercial bank, these legal systems have some defects in instructing the insolvency of the commercial bank. So based on analyzing the differences lying in the insolvency between the commercial bank and the ordinary enterprises, combining the actual conditions of our country and using the advanced experience of some foreign countries, it is absolutely necessary for our country to perfect the insolvency system of the commercial bank including insolvency compromise, insolvency reorganization and insolvency liquidation these three aspects.