The New Basel Capital Accord And China's Commercial Banks To Interest Rate Risk Control

In recent years, with China's entry into WTO and the globalization of economy and finance, our banking industry will face unprecedented development chances and challenges. At the meantime, banking interest rate risk will be increased by the gradual opening up of the finance industry and by advancing the interest rate market with steady steps. In this article, besides the conclusion of the banking interest rate risk, the author with the reference of "Basel Ⅱ", also analyses the status in quo of the banking interest rate risk and then puts forwards some proposals for the establishment of the mechanism of the controlling of the banking interest rate risk.This article is composed of 6 chapters. The first chapter is the introduction, in which the author analyses the background of writing this paper. The second chapter makes a general research about the interest rate risk. The author especially focuses on the introduction to the concept, creation, developments, aims & principles of the management & supervision of interest rate risk, as well as the influence of the interest rate risk towards the commercial banking system. Further more, in this part the author also illustrates and analyses some relevant models of it. The fourth chapter deals with our state's undergoing circumstances in management of interest rate risk & countermeasures, in this part the writer concentrates on the existing problems of interest rate risk of commercial banks, the forms of interest rate risk of our nation & our nation's interest rate market. In the fifth chapter, according to the previous analyses & the requirement of "Basel Ⅱ" complied by Basel committee in July, 2004 & puts forward the frame of forming & shaping our nation's organism of the management towards the issue, interest rate risk of china's commercial banks. Chapter 6 is the conclusion.The author acknowledges that in china, the market-driven interest rate risk already achieved dramatically and steadily, and that banking interest rate risk has already become the main risk for commercial banks. To strengthen the forecast of the market interest rate, to consummate the measurement, the inspection and supervision system of interest rate risk, and to promote the managerial procedures to the interest rate risk are the main procedures to avoid interest rate risk for banks.