Corporate Governance Issues In D City Commercial Banks

From 1970 s, the academia puts forward a series of classical theories of corporate governance which are still playing an important role on the global corporate governance,such as the agent theory, incentive contract theory, enterprise control theory, and stakeholder theory. In practice, all the countries in the world continue to promote corporate governance suitable for themselves with the development, and the following three modes are successful : Anglo-American model which is Market-oriented,Japanese-German mode which is dominated by stakeholders checks and balances, East-Asian countries model which is deeply influenced by the Confucian thought. After the financial crisis in 2008,the Anglo-American model of the corporate governance has great changes which shows the new features of paying more attention to external supervision. Especially after the promulgating of "Dodd- Frank Wall Street reform and Consumer Protection Act" in July2010, the United States government official abandoned the extreme liberal economic thought, corrected the drift behavior on the banking industry, gradually strengthen government regulation of the banking industry. Based on this point, this paper argues that the current corporate governance of city commercial bank exist problem.City Commercial Banks are late started compared to the large state-owned banks or joint-stock banks, but they developed rapidly. This paper thinks that to study the corporate governance of the City Commercial Banks can further promote their scale and strength, it can also promote the perfect of China’s financial system. In order to study the company governance of the City Commercial Banking, library database and other relevant channels.Secondly, through the method of field investigation combined with data collection, this paper grasped D Bank ‘s company governance, such as ownership structure, governance body construction, incentive mechanism, information disclosure and other basic information, establish the foundation for the comprehensive analysis of D Bank’s company governance. Finally, this paper uses the method of comparative analysis to find the cause of city commercial bank development bottleneck, and draws lessons from successful commercial Banks advanced practice for the perfection of the city commercial bank corporate governance in-depth exploration.This paper summarizes the company governance problems of D Bank in three aspects combined with the development situation of the domestic banking industry, the three problems are ownership structure, governance body and operating mechanism. This research can build the basic framework for further research. Firstly, the ownership structure is the key to produce of "agent", large shareholders intervene in corporate governance orintervene in the strategies of the company for its own interests, resulting in damage to the interests of small shareholders. Secondly, the formation of the main structure of checks and balances of the company governance are the core company governance of modern bank.The board of directors, supervisors and senior manager can not carry out their duties to make bank strategy, development model, risk management and internal control to jointly promote the development of bank business. Finally, domestic commercial banks have realized the reform of corporate governance structure, forming a "three layers and one board" corporate governance structure. Based on the analysis of D bank’s corporate governance, and in-depth comparative analysis of Anglo-American corporation governance model ", " Japanese-German corporate governance model”, and domestic commercial bank’s corporate governance to improve D Bank corporate governance, this paper puts forward some useful suggestions from the ownership structure, the subjects of corporate governance and operating mechanism.Based on the analysis of the problems existing in the domestic bank’s corporate governance, this paper makes deep thinking and explores the solutions. This paper argues that it is benefit to cultivate a good corporate governance environment on the base that, the city commercial banks to further optimize the equity structure, to keep the reasonable equity ratio by the local governments, private enterprises and strategic investors, to form the relatively stable and efficient balance pattern. At the same time, from the angle of checks and balances, we need to constantly improve the company governance structure,such as: paying attention to the professional background of the board of directors,enhancing the ability to perform their duties of directors, improving the system of independent directors, the board of supervisors to ensure full performance. In addition, city commercial banks should learn long-term incentives in order to establish suitable incentive mechanism, such as stock ownership incentive modes of ” Anglo-American model" or spirit incentives of "Japanese-Germany model".This paper argues that an effective incentive mechanism should pay attention to the long-term development of the bank, the good application of equity incentives and other means, it should also focus on efficiency and reward & punishment simultaneously. Finally, this paper argues that the development of China’s city commercial bank corporate governance is inseparable from the capital, manager market and other constraints, it is also inseparable from the People’s Bank of China, the CBRC regulatory and market discipline and external supervision. Market discipline and external supervision are the trend of the development of the corporate governance of commercial bank in the world.