Postal Savings Bank Financing Business Introduction

This paper is focused on wealth management business of Post Savings Bank of China. Firstly, the first part introduces the history and classifications of wealth management business. It also answers the question why a commercial bank whose aim is profit making should take on wealth management business. The reasons are as follows:the domestic middle-income and high-income groups are growing rapidly after the reform and opening-up policy and the gap between deposit rate and loan rate is narrowing down, therefore taking on wealth management business can meet the need of improving the commercial banks’ revenue and competitiveness. It is also an inevitable choice for domestic commercial banks in order to act on international convention. In addition, the first part introduces the financial products provided by Post Savings Bank of China and its management framework of running wealth management business as well. At the same time, the first part of this paper also describes the characteristics of different financial products of domestic commercial banks such as Merchants Bank and China Construction Bank, which lays the foundation of the second part analyzing the disadvantages of wealth management business of Post Savings Bank of China and its corresponding improvement methods.The second part of this paper analyzes the existing problems of the wealth management business of Post Savings Bank of China from four aspects including operation mechanism, unclear business positioning, shortage of experts and weak technical support. It analyzes the bottlenecks of the wealth management business of Post Savings Bank of China directly based on the characteristics of this bank. As for its operation mechanism, because Post Savings Bank of China is newly established, its organization structuring is not reasonable and the administrative tasks are overwhelming between the superior and inferior. Meanwhile, there is little market stimulation. Human resource and financial management are far behind modern commercial banks development. In the aspect of business positioning, Post Savings Bank of China is advertising "36000net spots, all-function bank" lately while it was positioned as a retailing bank "serving for villages and communities" by the Banking Regulatory Commission, from which we can see that the business positioning of Post Savings Bank of China is contradictory and confusing. At the same time, this bank has not paid enough attention to its wealth management business and has not reached a consensus. Corresponding supportive methods and environments are not able to meet the need. In the case of shortage of experts and weak technical support, being newly separated from the post system, Post Savings Bank of China must start from scratches. The operators know the post system well but are not familiar with commercial bank’s operation or risk control. Its financial information system, which is among the essential factors leading to the success of wealth management business of commercial banks, is far behind that of other commercial banks. The second part of this paper analyzes the above aspects of Post Savings Bank of China and directs the following solution methods.The third part and the fourth part are the key points of this paper. The third part studies on the counter measures and methods to develop the wealth management business of Post Savings Bank of China from the perspective of this bank itself. For example, it puts forward "break-even with small margins" in its development principles based on its wide range and abundance of depositors, which makes it possible to make profits with the Long Tail Theory in modern marketing. Then it studies on the channel construction of Post Savings Bank of China. As everyone knows, the systems of net points, ATM, online banking and phone banking of Post Savings Bank of China are imperfect owing to its short history and underestimation of their importance. However, today channel construction has been more and more important in the competition in financial world. Post Savings Bank of China should firstly learn from other successful experiences to improve its competence in channel construction. At the same time, the Post Savings Bank of China shall reorganize and reconstruct its channels and make an effective combination of channel construction and marketing for the sake of offering good wealth management service and saving costs. An excellent wealth management business development model shall includes "who are the customers, what is the service philosophy, what are the products and what are the technical support". The four questions actually involve almost all businesses of a commercial bank in a direct or indirect way. This part also directly expresses the core of wealth management business development strategy of Post Savings Bank of China from the aspects of products innovation, information and technology input and personnel training, etc.The fourth part is an independent unit. It draws a conclusion that the target customers of Post Savings Bank of China are small and medium customers based on the former parts and the analysis of wealth management business development trend and the status quo of Post Savings Bank of China. It also explains the necessity, feasibility and operability of developing small and medium customers.The fifth part of this paper demonstrates the risk control methods of Post Savings Bank of China separately.