The Impact Of Financial Derivatives Trading Of China’s Commercial Banks On Its Risk Level

Since the 1970s,the international financial market has undergone dramatic changes.With the changes in technology and the innovation of financial products,the risks facing the financial industry are also increasing.As a product of financial innovation and risk avoidance,derivatives have developed rapidly,and derivatives have been favored by commercial banks for their leveraged trading,low cost and high profitability,and have become an important part of commercial bank management reform.Initiative.After the 2008 financial crisis hit the international financial market,financial institutions and investors began to re-examine the risks faced by financial derivatives trading.China’s commercial banks officially participated in the trading of financial derivatives late,but in recent years,both the overall scale and the total assets accounted for a rapid growth.The rapid growth of derivatives trading scale has a great impact on the risk of China’s commercial banks.Therefore,in this context,it is very meaningful to study the impact of derivatives on the risk level of China’s commercial banks.Based on the literatures of relevant researches at home and abroad,this paper selects the annual panel data of listed commercial banks from 2010 to 2017 through empirical test methods,establishes a model of financial derivatives impact factors on commercial banks,and analyzes financial derivatives transactions.And the direction and extent of the impact of different types of derivatives transactions on the risk level of commercial banks.The full text is divided into five departments,as follows:Chapter 1,Introduction.This paper mainly discusses the background and research significance of this paper.Through the collation of domestic and foreign literatures,it summarizes the research directions and achievements of financial derivatives at home and abroad,and puts forward the methods and research contents used in the research of this topic.Et al;Chapter 2,the relevant theoretical analysis of financial derivatives.This chapter mainly introduces the varieties and functions of financial derivatives,and analyzes the decisive factors affecting the trading volume of financial derivatives and the ways in which financial derivatives affect the risk level of banks.The third chapter mainly analyzes the current situation of financial derivatives business of commercial banks in China.This chapter first introduces the history of derivatives trading in commercial banks in China.Then,it uses the form of graphs to describe the total amount of derivatives transactions and growth rate of various types of commercial banks,and the trading volume and proportion of various derivatives of commercial banks.Analysis of growth rate.Finally,the paper analyzes the problems existing in the financial derivatives trading of commercial banks in China,that is,the types of financial derivatives transactions are relatively single,lack of pricing power;the system of supervision system is not perfect;the lack of high-end talents;etc.The fourth chapter,empirical test.This chapter firstly sets the indicators for measuring bank risk through theoretical analysis.It selects the relevant variables that affect the bank’s risk level from the bank’s own perspective and macro-environmental perspective,and makes a descriptive analysis of each variable in the form of a table.The unit root method was used to test the stability of each data.The fixed-effect model of invariant parameters was selected by using F-test and Hausman-test test results.The model of financial derivative position impact on bank risk was established.Again,using Eviews10.0 The software makes a regression analysis on the direction and magnitude of the impact of the total amount of derivatives transactions and the transaction volume of different types of derivatives on bank risks,and obtains empirical results.Chapter V,conclusions and recommendations.Through empirical analysis,the conclusion is drawn that the total amount of financial derivatives has no significant effect on the risk level of commercial banks;the transaction of interest rate derivatives can effectively reduce the risk level of banks;the transaction of foreign exchange derivatives does not reduce the risk of banks,but to a certain extent It has aggravated the risk level of banks;banks still have many problems in developing financial derivatives business.Then,based on the above theoretical analysis and empirical research,the commercial bank and the supervision system are proposed to develop financial derivatives business.From the perspective of commercial banks,we must improve the traditional profit structure and promote diversified business development.In the development of financial derivatives business,we should select appropriate development strategies based on the bank’s operating conditions,introduce innovative technical talents,strengthen innovation capabilities,and improve products.Development capabilities,while strengthening the bank’s internal control to effectively prevent potential risks arising from financial derivatives.From the perspective of the supervisory organization,we must first improve the legislative level and improve the laws and regulations;secondly,gradually improve the financial derivatives information disclosure system to effectively supervise the banking financial derivatives business;finally,reform and adjust the supervision system to improve The professionalism of supervision and the efficiency of supervision will promote the steady and rapid development of the derivatives business of commercial banks.The innovation of this paper is the impact of the total amount of financial derivatives transactions and the types of derivatives on the risk level of commercial banks in China from a qualitative and quantitative perspective.At the same time,there are certain innovations in the selection of empirical test variables.