Research On The Financial Risk Management Of Commercial Bank In China Based On The New Basel

Since the 1970s, the development of financial liberalization, financial globalization and financial innovation has allowed international bank to face increasingly more complex risks, promoted commercial banks to continue to improve their risk management, and also enhance their ability to resist risks. With the reform and opening of China, commercial banks keep learning the advanced Western commercial banks risk management experiences, so the financial risk management has been significantly improved. The promulgation of the BaselⅡmarked the era of ERM. The financial risk management of commercial banks must establish a comprehensive risk management concept. At present, China is fully implementing BaselⅡand BaselⅢat the same time, commercial banks need strictly accord to the content under the new BaselⅡframework, establish a comprehensive risk management idea, enhance their risk management techniques, and constantly improve their own level of financial risk management, in order to enhance our bank's international competitiveness.China's current level of capital adequacy ratio is higher than that of international bank in average, but with the conduct of the new Basel, China's capital adequacy ratio will be decreased, which requires China's commercial banks to improve their financial risk management.In this paper, my research object is the financial risk management of commercial banks. The first part I reviews the basic theory of financial risk management of commercial bank's including the definition of financial risk, financial risk classification of banks, the changing of financial risk management. This part is the laid laid a theoretical foundation for this article.Furthermore, this article highlights the "BaselⅡ", analyzes the historical development of the Basel agreement, anyalyzes the main content of BaselⅡand also compared the old and the new BaselⅡ. At last anlyze the challenges of the implementation of The New Basel gave to the China's financial risk management of Commercial Bank.Then I use the "Regulation on Commercial Banks of core risk indicators" system issued by the CBRC. I selected a group sample of representative listed commercial banks. Than I respectively analyze the commercial bank conditions of capital management, liquidity risk management, credit risk management, market risk management and so on. Also I analyze these banks'capability of risk buffer.Finally, at the perspect of three pillars of the new Basel, I give the policy recommendations of the construction of ERM, strengthen of financial supervision and information disclosure respectively, In order to build ERM, we must cultrivate ERM culture as soon as possible, optimize the structure of commercial bank, establish vertical organizational structure, optimize the risk management processes, strengthen internal controls and so on. At the same time to strengthen financial supervision and the information disclosure system would play a positive role in the building of ERM of commercial banks.The main contribution of this paper can be descibed as followed. Through descibing the financial risk management theory of commercial bank, I analyse the the current situation of Financial risk Management of commercial bank in China by using the core indicators of monitoring risk released by CBRC. Based on the content above, i descibed how to build the financial risk management framework under the new Basel. I think this paper more rely on the anlysed result by the core indicator, which may be not sufficient.