Principles of investment banking supervision

The supervision principles of investment banks are supervision according to law, reasonable and moderate supervision, openness and fairness, and equal emphasis on safety and efficiency.

1, principle of supervision according to law

Unified supervision according to law is the concrete embodiment of the concept of governing the country according to law in the constitution and the principle of administration according to law in the field of financial supervision law. The so-called supervision according to law means legal supervision, that is, financial supervision activities must be carried out according to law. Supervision according to law includes supervision subject, supervision content, supervision procedure and the legitimacy of supervision power.

2. The principle of reasonable and moderate supervision

Reasonable and moderate supervision means that the main body of financial supervision must take the realization of financial supervision objectives as the premise, respect the laws of financial markets, use effective supervision measures to improve financial efficiency and maintain fair competition, so as to promote the development of the financial industry.

3. The principles of openness and fairness

According to the principle of openness, the objectives, framework, decision-making and basis, data and other information of financial supervision need to be fully, conveniently and timely informed to the public and relevant parties, so as to ensure the public and relevant parties' right to know about the supervision process and results.

4. The principle of paying equal attention to safety and efficiency

Safety and efficiency are the eternal themes of financial supervision. The principle of financial security requires regulators to take various measures to prevent and resolve financial risks and ensure the safe and stable operation of the financial system. Financial security is related to the health and stability of the whole financial market, and it is also the fundamental starting point of financial supervision.

Advantages and disadvantages of investment bank supervision

1, advantages

Comprehensive and detailed rules provide a basis for supervision. The more detailed and specific the regulatory rules are, the easier it is for regulators to implement them. Regulators can only find problems with banks by checking whether they abide by these rules. Comprehensive and detailed rules provide standards for bank operations.

There are unified securities laws and special regulations, which make securities behavior and investment banking activities have laws to follow and improve the authority of supervision. Controlling market economic behavior in the form of law provides a strong constraint for investment banks to participate in securities and investment banking business in the market.

2. Deficiencies

Rule-oriented supervision puts too much emphasis on law and is not sensitive enough to the market. It does not take into account the special circumstances of different banks, and it is not flexible enough and too rigid. Different banks may come up with better ways to control risks according to their own actual conditions, which is difficult to exist under the inflexible supervision system. In addition, too rigid regulatory rules also limit the innovative power of banks.