Study On The Internal Control Of Illegal Loan Cases In Chengdu Branch Of Shanghai Pudong Development Bank

With the continuous deepening of China’s financial reform,the steady progress of interest rate liberalization,the development of the banking industry gradually toward maturity,commercial banks in the competition to continue to mature at the same time,but also exposed many problems.In recent years,bank risk cases have occurred frequently,and regulators have repeatedly issued large fines.As the first major case in 2018,the CBRC of Sichuan announced the punishment result of SPD bank Chengdu branch on January 19.In order to cover up the nonperforming loans,Chengdu branch illegally extended credit worth77.5 billion yuan to 1,493 shell companies through falsifying statements and debt-bearing acquisitions,and was fined 462 million yuan by CBRC of Sichuan.The case exposed the serious failure of the internal control system of SPD bank Chengdu branch and sounded the alarm for other commercial banks.Whether the internal control system of commercial banks is perfect or not has a direct impact on their profitability and financial risk prevention ability.Therefore,commercial banks must pay attention to the problem of internal control,otherwise it will not only affect the steady operation of banks,but also hinder the orderly development of China’s financial industry and even the real economy in the long term.Taking the illegal loan case of SPD bank Chengdu branch as the research object,this paper first analyzes the illegal loan case of SPD bank Chengdu branch from the perspectives of the background of this case,the personnel involved and the process of the case,and then finds out the reasons for its fabricating false information and illegal credit granting.Secondly,the problems exposed in the case are analyzed from the perspectives of lack established internal control culture,loopholes in human resource management,ineffective implementation of internal control system,incomplete construction of information system and supervision failure.Finally,suggestions are made on improving the defects of internal control system of Chengdu branch from the aspects of internal control culture,human resource management,internal control system construction,internal supervision and external supervision,etc.At the same time,it is also hoped to make contributions to further improving the internal control management level of China’s commercial banks.