Research On The Risk Control Of Stock Pledged Repo Of A Securities Co.Ltd.

In December 2017,the Central Economic Work Conference listed "preventing and resolving major risks" as the first of the "three major battles" in the next three years,with emphasis on preventing and controlling financial risks.In 2018,the large-scale callback of the stock market led to the frequent bursting of stock pledges by major shareholders of listed companies,which shows that there are certain problems in risk management of both financiers and securities companies.Therefore,how to prevent and control the risk of the stock pledge repo business has become an important part of ensuring the stable development of the capital market.This paper takes the stock pledge repo transaction business carried out by A Securities Company as the research object,and puts forward countermeasures and suggestions for risk management in the process of business development.Firstly,this paper introduces the basic situation of stock pledge repo business and the operating environment of securities companies in China.Then it analyses the current situation of stocks pledge repo business under the new policy and regulations.After identifying the main risk characteristics of stock pledge repo business of securities companies,it analyses the development of the stock pledge repo business in A securities company.The organizational structure of risk management and the auditing process of stocks pledge repo business are discussed.With the comparision of two default cases of stock pledge repo business in securities company,the reasons and disposal of the defaults are deduced from the perspective of both the repo buyer and the target listed securities company.Then this paper studies the risk management system of stock pledge repo business of A securities company and provides useful risk management strategies.This paper comes to the following six risk management proposals:firstly,optimize the stock pledge repo business audit process to ensure customer due diligence process;secondly,promote the digital transformation of risk management processes;thirdly,build a comprehensive dynamic risk management system;fourthly,rationally screen the underlying securities and repo buyer,for example,select the underlying securities with low overall stock pledge ratio and the repo buyer with a good credit history.Then,we should rationally and scientifically determine the stock pledge rate and the stock benchmark price,and improve the pricing mechanism.Lastly,we should strengthen the risk management personnel and performance appraisal system.