The Research For Risk Prevention Of The International Settlements Business By X Branch Of Agricultural Bank

With the rapid development of international economic globalization and the accelerating of integration process of global economy, the international economic business is becoming increasingly active, and the cooperation between countries, regions and groups becomes closer. The international settlements, with its status and affect becoming more significant and important, functions as a link among the process of international economic trade contacts.In our country, the international settlements business of commercial banks offers various settlements modes such as remittance, collection, and letter of credit. It provides payment facilities for all sides in international trade transactions, offers trade finance for enterprises, and promotes the development of international trade in domestic companies, from which the banks obtain intermediary service fees. The international settlements business belongs to one of banks’ important intermediary businesses. Because of the high yields, it is becoming the core of business competition of every commercial bank.The international settlements business involves varied kinds of customers, extensive activities, and comprehensive complexity. In business processing, therefore, not merely one settlement instrument is chosen, but various settlement modes are used cooperatively. Besides, the business in international settlements faces some special operating principles to follow, miscellaneous procedures, and difficulties in operation. So banks are faced with various risks, which are greater and more complicated than those of traditional banking businesses. The international settlements business is a measurement of operating strength and standard for risk management of banks. In determining the development goal of international settlements business, commercial banks cannot aggressively pursue high percentage of market share and handsome profit, but focus on its business risk, with a view to preventing and defusing risks timely and effectively, and ensuring its sustained and healthy development.This thesis aims to introduce the risk types of international settlements business in Agricultural Bank of China, X Branch(Hereafter referred to as X Branch) and its present condition of risk prevention, and point out the issues in its risk prevention through the analysis of actual cases. The findings show that the main problems lie in the inner risk control system, operational risk system construction, professional quality of employees, risk awareness, and mechanism of rewards and punishment. By reviewing and analyzing extensive literature and considering this bank’s realities, this thesis also suggests that the bank should improve its inner risk control system and operational risk system, improve the mechanism of talent training,strengthen risk prevention awareness, and improve mechanism of rewards and punishment, in order to perfect its risk prevention system and promote healthy and effective development of its international settlements business.