| With the deepening of global economy integration and China’s policy to expand domestic demand, international and domestic trade has developed rapidly, meanwhile, trade financing business is playing a move and more important role in domestic commercial banks. It is no longer to be regarded as the subsidiary products under credit service, but is the available instrument for the bank to take advantage of in the fierce markets as well as the important source of the profit. However, we can see that the risk of trade financing is also evolving accompanied by a diversification of trade and simplified instrument of settlement. Since risk management in trade finance of domestic banks is on a late start, there is a gap existing obviously for the sense, the model, the system and the practical application compared with the global banks. Under current financial crisis and global economic downturn, the risk of trade financing is gradually increasing. How to effectively prevent and manage risk is becoming an important topic with great significance for the sustainable development of domestic banks.At the beginning of the thesis, it analyzes the status of trade finance business and current issues of risk management in domestic banks. Secondly, it takes S bank as an example by using specific cases to demonstrate the idea of risk management in trade finance as well as on the application in practice. From a practical point of view, It is useful to provide reference for domestic banks how to enhance and improve the ability of risk management, including how to structure the organization, how to design the processing procedure and report system, how to setup the authorization matrix, to make sure the independence, coordination and effectiveness of risk management. At last, regarding to current status and the gap of risk management on domestic banks, the thesis develops the recommendations for domestic banks how to establish and improve risk management in accordance with its own characteristics. |
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