Commercial bank bankruptcy of China's commercial bank bankruptcy risk of the main sources

Currently, the bankruptcy risk of China's commercial banks mainly comes from the following five aspects:

1. Credit risk.

Credit risk refers to the possibility that the loans issued by commercial banks will not be repaid, or the quality of their investments will deteriorate resulting in defaults, thus bringing losses to commercial banks. The business goal of commercial banks is to maximize profits, and to achieve this goal it is necessary to issue loans by absorbing public deposits in order to obtain a spread. As we all know, at present, many domestic enterprises operating in the doldrums, their own poor efficiency, unable to repay the due bank debt; many enterprises are faced with structural adjustment, to find a way out, resulting in a large number of bad and doubtful debts of commercial banks; there are also some enterprises through the separation, merger, bankruptcy and other restructuring of the opportunity to overhang and evade debt, so that the commercial banks either can not find the debtor, or can only get a very small percentage of the liquidation, thus causing a Great credit risk. Commercial banks occupy a dominant position in China's financial system and play a pivotal role in China's economic development. Therefore, if the huge credit risk is not resolved in time, it is very likely to lead to a financial crisis once there is a trigger of unexpected factors. The Mexican financial crisis that occurred in 1994 and the Asian financial crisis that broke out in 1997 both illustrate the potential harm of credit risk.

2. Interest rate risk and exchange rate risk.

Interest rate risk and exchange rate risk refers to the possibility of asset depreciation loss caused by changes in interest rates and exchange rates in the market, resulting in changes in asset prices of commercial banks. Interest rate risk and exchange rate risk is basically determined by the supply and demand of funds, it is a market risk.

In China's commercial banking business, this kind of risk is very difficult to avoid, because any commercial bank is powerless to control the market, even if the central bank can only regulate to a certain extent. in July 1997, the Thai government was forced by the market's great pressure, announced the implementation of the floating exchange rate system, the Thai dollar immediately depreciated by 17%. Since then, although the governments of the countries concerned have intervened in the market on many occasions, the currencies of Indonesia, the Philippines, Malaysia, Singapore and South Korea have all depreciated sharply one after another under the pressure of the market, and the stock market has also plummeted. Take Korea, one of the "Four Little Dragons of Asia", as an example, the Korean won depreciated by more than 50% in just over two months, and the domestic stock price index fell to the lowest point in 10 years. It can be seen that interest rate risk and exchange rate risk in the global economic integration of today, for the normal operation of commercial banks caused by the impact is huge and far-reaching.

3. Liquidity risk.

The possibility of commercial bank bankruptcy also comes from liquidity risk. Liquidity risk is the risk caused by the insufficient payment capacity of commercial banks. The liquidity needs of commercial banks mainly come from the withdrawal of deposits and the demand for loans, this demand is difficult for commercial banks to fully grasp, unanticipated withdrawals and unanticipated demand is likely to lead to problems with the ability of commercial banks to pay, which is a normal risk that often occurs in the business of commercial banks. Concentrated withdrawals of large deposits or universal deposits are likely to put commercial banks in a difficult situation when depositors lose confidence in the bank or when market interest rates significantly exceed commercial bank interest rates. Article 39 of the Commercial Banks Act stipulates that "the ratio of loan balances to deposit balances shall not be less than 25%, which is a good example of the important impact of asset liquidity on commercial banks". In the 1997-1998 Asian financial crisis, due to the Asian countries credit over-inflated, once the international lobbying and the impact of the country's economy is facing a difficult situation, it triggered a strong run on the public, resulting in a large number of financial institutions due to the lack of liquidity and have to close down, many of which are commercial banks.

4. Capital risk.

Capital risk refers to the risk that commercial banks have too little capital and therefore lack the ability to bear the risk of loss, the lack of deposits and other liabilities of the final settlement, so that the security of commercial banks is threatened. Capital risk has a significant impact on the ability of a commercial bank to operate normally. This is because capital has the function of not having to be repaid and of being able to assume business risks.

If the source of funds of commercial banks are all capital, the risk of all by the commercial banks themselves; if the source of funds in the capital and liabilities accounted for 50%, half of the financial risk to be borne by the depositors. Due to the intermediary characteristics of commercial banks in socialized mass production, it is impossible for commercial banks not to be indebted to the public, so the adequacy of capital is particularly important. The more adequate the capital is the more it can be used to compensate for losses incurred, protect commercial banks against unexpected losses and tide over the crisis, thereby protecting the interests of depositors. At present, many of China's commercial asset management quality is low, too many non-performing claims, failing to meet the "capital adequacy ratio shall not be less than 8% ((Commercial Banks Act, Article 39) requirements, to a certain extent, there is a greater business risk.

5. Management risk.

Management risk is also one of the causes of possible bankruptcy of commercial banks. Management risk refers to the commercial bank business operations in the risk of smuggling and theft. The so-called private gain, mainly refers to the commercial bank's internal staff, especially the senior management, use their authority to seek personal gain, such as illegal loans to themselves or their friends and relatives, and so on. As for theft, it can come from both inside and outside. At present, in China's commercial banks, the asymmetry of information and the widespread existence of moral hazard make commercial banks carry out credit business with a large number of uncertain risks. The poor quality of employees in some commercial banks and the emergence of corruption and theft within the bank have also led to an increase in the non-performing assets of commercial banks, which has further increased the operational risks of commercial banks.