Overall Management And Research Of Risks For Small And Medium Size Financial Institutions In Rural Areas

The production of small and medium sized financial institutions in rural areas is a new product of the reform of the banking system in china, such as: rural commercial banks, rural cooperative banks, rural credit cooperatives, and village banks. For decades, with the rapid development of small and medium financial institutions in rural areas, they have become an integral part of China’s financial system which plays a promoting role in development of economy and finance. With the diversification of the types of banking business diversification, and across all kinds of business, its risk is not just a single risk, but a set of risks which are credit risk, market risk, operational risk, liquidity risk and other risks. These risks across each other and have a strong correlation with each other. With the change in the financial environment, the risk management department of financial institutions is always separated from the risk management of financial institutions under the existing single risk management mode. This will inevitably result in the neglect of the interaction between risk.Therefore, the risk management of small and medium financial institutions in the rural area at their own risk management perspective should fully consider the relationship between various kinds of risks, manage risks as a whole. Overall risk management will be the development trend of the risk management of financial institutions in the future.The ultimate goal of this study is to explore how small and medium financial institutions in rural areas in accordance with the Guidelines for the Construction of Risk Management Mechanism for Small and Medium Sized Financial Institutions in Rural Areas to achieve comprehensive risk management. First of all, this paper analyzes the impact of Basel Agreement III on the risk management of the banking industry, and analyzes the connotation of the comprehensive risk management. Based on CBRC issued by small and medium financial institutions Guidelines on the Guidelines on the Construction of Risk Management Mechanism for Small and Medium Sized Financial Institutions in Rural Areas and Guidelines on the Construction of Risk Management Mechanism for Small and Medium Sized Financial Institutions in Rural Areas for the Program, this paper analyzes the current regulatoryrequirements for the construction of a comprehensive risk management of small and medium-sized rural financial institutions and the specific content. This paper also expounds the necessity and significance of the comprehensive risk management in rural small and medium sized financial institutions. Secondly, in remote areas of our country, small and medium-sized rural financial institutions to agriculture and animal husbandry such as S village bank, this paper analyzes several aspects of risk management characteristics and present situations, such as credit risk, operational risk, market risk, and liquidity risk, and find our the differences between that and Guideline. Third, this paper describes the specific practices of S rural bank comprehensive risk management, designs the path of building a comprehensive risk management, analyzes the contents and steps of the construction, and discusses the possible obstacles and measures.This paper explores the comprehensive risk management of S rural bank, improves the level of risk management, and hopes that the research can contribute to the small and medium financial institutions in rural in China to better implement the CBRC’s document Guidelines on the Construction of Risk Management Mechanism for Small and Medium Sized Financial Institutions in Rural Areas, to ascend and rural small and medium financial institutions own risk management level.