Chinese Commercial Bank Silver Certificates Mixed Risk Prevention Research

After China's entry into WTO, the Chinese commercial banks are destined to participate in the global economy and to face the keen competition from the financial conglomerate of the western developed countries. The mixture run has become an inevitable trend for the Chinese banking industry because of the great internal pressures and the external fierce competitions. What we should do is to set a risk control system to meet the banking industry and the financial supervision authorities' urgent demand. Considering the realities of our country and absorbing the advanced foreign experiences, how to control the possible risks of mixture run for the Chinese banks is themain problem that this paper aims probe into and search out solutions to.Compared with the separate run, the mixture run has the advantages of information economy and scope economy, but it also has the disadvantages of expansion of risk, conflicts of interests and extension of subsidy. In perspective of fire wall, the financial holding company model is the best choice in terms of Chinese actualities, which can be compatible with banking management abilities and financial supervision level in China. Because the Chinese stock market is only a negative sum market in general, Chinese mixture run banks should not invest in stock at the moment in their asset allocation. And they must control the risk from illegitimate fund-flow into stock market through bank loan. To control the interest rate risk of bond investmemt, Chinese mixture run banks can pursue immunization strategy and yield curve strategy. Mature internal risk control system and external supervision system are the indispensable safeguards for the peaceful transition from separate run to mixture run based on western countries' experiences. To cover the new risk of mixture run banks, and stand out the request of emphasis on risk quantitative analysis advanced by the the Basel New Capital Agreement, Chinese mixture run banks can use methods such as risk-adjusted rate of return, value at risk, stress testing, back testing and limits management, and should construct risk management structure based on whole enterprise. Chinese financial supervision reform should construct the lead supervision system insisting on the functional supervision principle. The external risk supervision of Chinese mixture run banks should include admittance rules, Chinese wall, fire wall, risk forecasting system and exit system.