Research On The Capital Supplementary Mechanism Of China Rural Commercial Bank

The outbreak of the subprime crisis make the "Basel II" which has not been implemented in the true sence ran aground.In order to establish the new rules for banking regulation as soon as possible and to ensure the stable operation of the banking sector,the Basel Committee released the "Basel III" officially in December 20 th, 2012.In this context,the China Banking Regulatory Commission formally promulgated the "Administrative Measures for the Capital of Commercial Banks(for Trial Implementation)" in June 7th,which is in combination with the actual situation of Chinese banking at this stage.This measures adhere to the principles of prudential supervision of the "Basel III", and make the capital requirements stricter, expand the risk measurement caliber, set a multi-level capital regulatory framework further.Then it makes the risk control system more robust and perfect.Compared with other commercial banks,the assets and capital of China rural commercial bank is less,and it presents the geographical operating characteristics significantly.At the same time,China rural commercial bank exists a series problems,such as the dispersion of property rights, simple organization structure, weak profitability, narrow channels in the capital replenishment. Facing with the stricter capital requirements,the demand of establishing a long-term and efficient capital replenishment mechanism becomes increasingly prominent. Capital is not only the most important prerequisite in the construction of a modern bank, but also the ultimate power to the development of a bank.Capital is responsible for the risk covering and the loss digesting finally,and bears the mission to shape the good corporate image of a bank.At the introduction of the new Administrative Measures for the Capital, the study of rural commercial banks’ capital replenishment mechanism means more important.The article starts with the general situation of rural commercial bank,which is the main force of China’s rural financial services.The number of China rural commercial bank,total assets size and gross profit all have achieved considerable development. And its overall capital adequacy ratio remains at a high level.The capital matches with its expanding size and risk level substantially, but the phenomenon that capital adequacy ratio vary greatly is more prominent. and gradually expand the proportion of supplementary capital, subordinated bonds are more a wide range of use and greater intensity. But its problems can not be ignored, the core capital and Tier convergence a lack of other capital instruments, overreliance on extrinsic sources complementary approaches to increase their investment and capital complementary passive existence and blindness. The reason why this series presents characteristics, mainly due to inadequate capital supplementary mechanism. Articles from capital planning, capital structure and capital complementary manner and timing of capital add-depth analysis of the reality of the four angles of Rural Commercial Bank capital replenishment mechanism exists. In the course of supplementary capital, vacancy, absence of forward planning of scientific guidelines, as well as a single supplement and complement the timing of capital approach presented lag and supplementary passive resistance, is the capital replenishment mechanism to establish an efficient process the need to solve a major problem. Finally, the proposed capital improvement suggestions from complementary mechanisms to effectively improve the identification and measurement of risk and optimizing the two major aspects of capital complementary approaches.