The Operating Risk Prevention Of The Financial Product Business Of Small And Medium-sized Commercial Banks

In recent years, the financial product business of commercial banks have developedrapidly, since 2005, the amounts of financial product have risen from 598 to more than 60000,the number of issuing bank have increased from 28 to 454. Compared with the joint-stockbanks, the small and medium-sized commercial banks spend less on risk prevention, so thatthe operational risk prevention is still not in place. Taking R Bank as a case, this paper studiesthe problems in the operating risk prevention of the financial product business, and putsforward some countermeasures. As well as, there are some beneficial recommendations to thesmall and medium-sized commercial banks.After fully research and analysis, there are some problems can be found in the operatingrisk prevention of R Bank. First of all, organization structure is too single. Secondly, businessprocess is not standard. Thirdly, the quality of the employees is not very high. Fourthly, theinformation system have not been intelligent.According to these problems, there are some countermeasures. Above all, taking thefinancial management division as an independent department, setting up the investmentmanagement committee. Then, the design plans, risk assessment, final approval should bepresented by different divisions. What’s more, introducing talents, training employees is good.Last but not least, replacing the manual account by the asset management system.Based on the case, combined with the situation of small and medium-sized banks, thereare some suggestions. Firstly, establishing financial management division and decisioncommittee. Secondly, practicing the independent approval mechanism. Thirdly, improving theemployees’ quality structure. Fourthly, improving the business information systems.The contribution of this paper is that, on the basis of studying the case, providing somebeneficial advices to the operating risk prevention of small and medium-sized banks.