Research On Liquidity Management Of Chinese Commercial Bank After The International Financial Crisis

Liquidity is known as "the lifeline of commercial banks". With liquidity, commercial banks have the ability to respond to emergencies and maintain the normal operation of the commercial bank. Conversely, if loss liquidity, commercial banks will face the liquidity risk and the threat of collapse. The international financial crisis happened in2008which caused the global liquidity reversal and made many financial flagships face the dilemma of liquidity, and this brought a warning for commercial banks to strengthen liquidity management.Though in the financial crisis commercial banks of China have not happened liquidity crisis that the Lehman Brothers and other financial institutions suffered, after the international financial crisis, along with the complex and ever-changing macroeconomic situation and the frequent changes in the macro-control policies, the liquidity of commercial banks of China also fluctuated violently. In just four years of2008-2011the liquidity of commercial banks in China was in a frequent change of "excessâ†'tightâ†'ampleâ†'tight". The main reason of huge fluctuation in liquidity was not commercial banks, but changes in the macroeconomic situation, especially the frequent changes of the macro-control policy. However, the fluctuation did not lead to the bank liquidity crisis and affect the profitability particularly, but brought a great deal of suffering and challenges to liquidity management of commercial banks. In recent years, although commercial banks of China have make more effort on liquidity management, there are still some gaps, such as management relying on regulators to promote, balance business depending on deposits and loans, short-term deposits with long-term loans, constraints of liquidity management from imperfections of financial market etc.Western commercial banks have a long history and their liquidity management have developed hundreds of years and become mature. However, in the impact of the United States subprime crisis and international financial crisis, liquidity management of the western commercial banks exposed many weaknesses which even led to some banks collapse. International financial crisis caused the western commercial banks to further strengthen liquidity management again, such as paying more attention to stability of funding sources, conscientiously carrying stress tests and scenario analysis, establishing more careful and systematic emergency funding plan, strengthening timely liquidity management, attaching importance to the impact on liquidity from off-balance sheet business and reputational risk etc.Therefore, profits from the overseas commercial bank liquidity management exp erience, to strengthen the liquidity management of commercial banks in China, firstly, we need to create a relatively stable macroeconomic and policy environment. Secondly, commercial banks should carry out more exploration in strengthening the consciousness of liquidity management, improving organizational system and decision-making process of liquidity management, strengthening financial innovation, improving liquidity management technology etc.