Analysis On Agricultural Bank Of HB Internal Control

As very important components in China’s financial system, commercial banks areirreplaceable in national economy and play a crucial role in financial intermediation.Commercial banks are special enterprises operating monetary business with the operationpurpose of pursuing profits as well as inherent risks. The risks are determined by theparticularity of their products. Profits and risks coexist and high risks mean high profits.Therefore, how to improve the risk-control level and increase profitability are all along theimportant research subjects in the field of commercial banks’ management.Since China’s entry into WTO, China’s banking industry has been continuing to expandits openness. With a series of reforms such as stripping out bad assets, optimizing ownershipstructure, stock system reform and listing, its operating capacity has been improved constantly.Meanwhile, relevant internal control and management measures have been improved andupgraded obviously. However, along with the requirements of internal control and riskmanagement by Basel Accord being more and more rigorous, there has been still a certain gapbetween the risk management level of internal control of China’s banking industry and therequest of Basel Accord. Especially US Subprime Crisis sweeping the globe in2008has had afar-reaching influence on the global economy. There often occur bank failures led by thebankruptcy of Lehman Brothers and the instant collapse of the bank with158-year historyproposes high demand on internal control and risk management of commercial banks. Inaddition, domestic banking cases emerge one after another and major cases with billions ofyuan occur frequently. For example, the sum of the loan fraud case of Qilu Bank reachedmore than6billion yuan, wich exposed the insufficiencies of the internal control andmanagement and those needing to be impoved of China’s commercial banks。 With theintegration of the working experience and reference of the requirement of internal risk controland management by Basel Accord and through the study of internal control theory, I wrote thepaper. The paper has analyzed all measures of the internal control and management taken byAgricultural Bank of China Hebei Branch and learned from the excellent commercial banks’international control experince abroad so as to look for weak links and shortcomings ofAgricultural Bank of China Hebei Branch in the area of internal control and management andpropose specific improvement scheme and measures for enhancing the internal control andmanagement level of the bank.. In the meantime, it will be some reference for the interbankimprovement of the internal control and management level。...