Research On Operational Risk And Incentive Mechanism Of Customer Managers In Credit Business In Commercial Bank

Commercial bank is one of the most important parts in the modern financial industry and it is also the basis of financial system and its risk is always attracting the attention of society.According to statistics,the Operational Risk is becoming the second largest risk of bank.It is only less than the credit risk and accounted for 35% and its harmfulness is growing all the time.The customer managers are the special agent of the commercial bank and they play an important part in the credit business.The Operational Risk problem puzzled the Chinese commercial bank for a long time and how to find the effective countermeasures to control this risk is an important task around academic world and banking world.Incentive mechanism has important influence on the behavior of the agent,but the existing bank's incentive mechanism has some problems.Therefore,it is necessary to make deep study of operational risk of customer manager and find effective precautionary measures from the perspective of incentive mechanism.With incentive mechanism as a breakthrough point,this dissertation probes deeply into the operation risk of the customer managers in the credit business through the principal-agent theory,contract theory and Organization design theory.The paper analyzes the operation risk respectively from two research perspectives of organizational relationship and business process and then the article get its influence and root causes.After this,with the moral hazard model,this dissertation Research how to design effective incentive mechanism to guard against operational risks of customer manager through a multi-objective model and other improved models.According to the organizational relations perspective,the customer manager is a bridge between Banks and customers in credit business and it constitutes two kinds of principal-agent relationship.The operational risk of customer manager is the main factor that causes loss of credit business.According to the business process perspective,customer manager runs through the whole process of credit business,its operational risks are mainly concentrated in the stage before loan and the stage after loan.The main form of risks is improper loans before the review and Post-loan risk cover.The roof of the operation risk is the moral hazard from customer manager themselves.The existing incentive mechanism of bank has problems which cause the moral hazard of the customer manager.As a consequence,this paper explores methods of operational risk with the perspective of incentive mechanism.In order to get effective incentive mechanism,this paper begins the research with moral hazard model.The result shows that the incentive mechanism given to the customer manager is a multiple-target model which contains the loan quantity and quality.The cost between the two targets is substituted and the difficulty of supervision and high cost of the loan quality led to moral hazard.So the bank need to set up reasonable incentive level to ensure that the customer manager to pay on the loan quality.The optimal incentive level setting is closely related to the cost function and the incentive mechanism should find the optimal level of loan quality incentives according to the different cost function.Add variable subjective assessment and threshold of loan quality,the bank can change the replace relationship into a complementary relationship,which can solve the problem of incentive weakening.Add the recessive incentive mechanism,customer manager can keep their behavior in high standard for a long time,which can reduce operating risk.Increase long-term performance appraisal in the incentive mechanism can reduce operating risk effectively too.In the end,this paper put forward a series of suggestions of incentive mechanism design to guard against operational risks with the research conclusion.