The Study On Early Warning Mechanism Of Risks Of Chinese Commercial Bank Corporate Governance

Commercial banks are particular enterprises and the security operations of banks are very important for stability and development of national economic. However there are various kinds of risks in the management process of commercial banks. It is crisis to the stable operation of commercial banks. Basel Accord made many provisions of the bank's risk control, but there are still many large banks failures because the controls of the risks are invalid. In China, all the banks are reformed. The internal control and risk control of banks are strengthening. But the rate of non-performing loans of is still very high, the management efficiency of commercial banks is low and the competitiveness is weak. These shows that it cannot fundamentally solve the problem of commercial bank risk only by strengthen the control of commercial banks. So it is important to identify the risks of commercial banks' corporate governance and to alert banks to control these risks. Therefore, it is worth to study the early warning of commercial banks'corporate governance risks.In my opinion, it is more important that to study the early warning of commercial banks'corporate governance risks than how handling these risks. The objective of establish an early warning system of corporate governance is to make shareholders, board of directors, managers and bank regulators to discover the risks in order to take measures to guard against timely. It is useful to detection of commercial banks'risks and potential crises timely. And it also makes banks keep the better operations.In this paper, I analyzed the particularity of commercial banks in corporate governance. Then I proposed the crisis of bank corporate governance, such as internal control, unfair related transactions, disclosure of false information and so on. And the interpretations of reasons, which are about commercial banks'corporate governance risks, are also included in this paper. On this basis, this article established the index system of bank corporate governance risk, and used the principal components analysis and logistic regression model to warning the risks. Through the test, we can find that this early-warning model has a better effect. Finally, we proposed risk prevention measures, which based on the conclusions.