Research On The Measurement And Management Of Operational Risks In State-owned Commercial Bank Based On Income Model

The sudden collapse of Barings Bank at the end of last century made the bank employees around the world realize the great damage of operational risks for the first time. Later along with constant serious losses due to operational risks around the world and the expanding loss scale, operational risk management becomes the priority among priorities for commercial bank risk management gradually, with deep research about it getting to the forefront in financial field soon. Though operational risk measurement technology has been applied in practice by international active banks, operational risk management technology in China banks is still lagging behind due to the late start. Operational risk management deficiencies in state-owned banks are the most serious. The state-owned banks leading the industry are facing with more serious operational risks than stock-holding banks due to their large asset size, complex organization and structure as well as extended business. It has become very urgent to research the operational risk management of state-owned banks in order to realize the objective of ensuring the general steadiness of our financing system and the healthy development of national economy.After a brief introduction to the basic concept and features of operational risks, deficiencies of internal control and management system and the measurement management of state-owned banks are taken as the point-cut to explore practical ideas about problem solving combining qualitative analysis and qualitative analysis. In empirical research, the most suitable risk factors were selected among those impacting net margin of state-owned banks through gradual regression method to establish income model and measure operational risks of state-owned banks, with the results showing that introduction of exchange rate risk can increase model accuracy greatly. Empirical research on the four state-owned banks shows that Bank of China has the top operational risk management, followed by Bank of Communications, with China Construction Bank comes the last. In the last part of solution proposals, this article explores from risk measure, improvement in point of internal control systems and risk mitigation, three aspects to consider fully and study the related suggestion to nationalized bank operating risk management.The steady and healthy development of bank industry, which is the key for the economic growth of a nation, is significant for the national economic development. And state-owned banks are the most influencing. Given this, profound research on the operational risk management problems of state-owned banks will become a long lasting problem for supervision level, bank industry and financial theoretical cycle. This paper gives comprehensive research on the topic through combination of qualitative and qualitative analysis, improve and perfect the income model further and provide a new idea about operational risk capital of state-owned banks, hoping to offer some practical and sound solutions and preventing ideas to the operational risk management of our state-owned banks.