Risk Management Research On Off-balance Sheet Activities Of Chinese Small Commercial Banks

With the deepening of reformation and opening of the finance, more and more commercial banks start to pitch off-balance sheet business as their new point of growth of profit. Since off-balance sheet business is providing No funds financial business, in most cases, financial institutions are only agencies that provide guarantee and help to avoid risk with their own credits. The potential risk of off-balance sheet business is much higher than that of on-balance sheet items.During the development of off-balance sheet business, since lack of innovation theory and practice experience, the level is low and market share is small, off-balance sheet business of commercial bank in our country are crying for the innovation. At the same time, risks of off balance sheet business must not be ignored. Main risk includes credit risk, market risk, fluent risk, operation risk and law risk. Since the severity and destructiveness of risk of off-balance sheet are underestimated, there are many risk management problems such as internal control system is imperfect, lack of effective supervise, lack of risk management human resource. On one hand, off balance sheet business must be developing innovatively, on the other hand, off-balance sheet business face more complicate market environment and more strict supervise requirement. Because internal control system is imperfect, lack of effective supervise, lack of risk management human resource and other reasons, risks is increasing with the developing of off-balance sheet business of small commercial banks.In order to provide reference and to improve the mechanism of risk management of off-balance sheet business for small commercial banks, on the basis of risk management experience of CCB, this paper study risk identify, risk analysis, risk control and risk audit, and proposes risk managing methods from five aspects:Risk management frame, risk identify, control methods, information transfer, internal audit, and suggests the risk management advices of off-balance sheet business of commercial banks.