The Internal Control Case Study Of Urban Commercial Banks In Residential Mortgage Loans

In recent years,with the continuous improvement of resident income and the rise of commercial housing price,the demand for residential mortgage loan has also been on the rise.For commercial banks,residential mortgage loans can bring stable earnings.However,due to tighter real estate policies issued by the government,as well as the uncertainty of real estate market prospective,commercial banks have to confront the systematic risk caused by real estate market fluctuations.Under this background,China Bank Regulatory Commission published <Guidelines for the management of commercial banks' collateral> in 2017.The guideline asks commercial banks to build up monitoring and management system for collateral,especially for real estate.Therefore,it is of great significance for the commercial banks to guard against risks and to run their businesses steadily by establishing and improving an effective internal control system and procedures for residential mortgage loans.At present,all commercial banks in our country have established a relatively complete internal control system according to relevant guidelines.However,in the respect of financial strength,technical ability,talent pool and system configuration,urban commercial banks are at a disadvantage compared with the national large-scale banks,and the design and implementation of the internal control system still lag behind.Take G bank as an example,it still uses the traditional risk control pattern,which caused problems including complex operation flow,ambiguous post division,undefined standard of rick control measure,and formalistic post loan management.As an result,the G bank's residential mortgage loans present low conducting efficiency,slow development rate,and poor risk distinguishing and controlling skill.This paper intends to use the case study method,select G Urban Commercial Bank as an example,using commercial bank's internal control theory,to find problems of residential mortgage loans business in the traditional internal control system of G bank.By modifying operation flow,making post division clear,defining standard of risk control measure,strengthen post loan management,the G bank can improve internal control system of residential mortgage loan,which can lead to higher conducting efficiency and lower risk.