On Risk-management And Supervision Of Financial Holding Company

Since the 1990s, the development of financial integration has been quite fast under the powerful push of the trend of economic globalization and the cross-sector operation in the international financial circle has become a trend. Furthermore, "M&A" wave in banking, insurance, security and other financial sections has exceeded a wave, which led to the production of diversified financial conglomerates in unprecedented speed. In order to comply with the trend of universal banking system, the west countries have gradually loosened financial control and financial institutions in those countries developed towards it. Some continental countries in Europe, for example Germany, take the universal banking system traditionally. At that time, the United States, Britain, Japan, Korea and many other countries permitted their financial institutions to carry on broad financial services in commercial banking, investment banking and insurance activities. The financial supervision mechanism in those countries correspondingly turned into integrated supervision authorities.Under such background of universal banking system and China's entry into WTO, the appeal to keep up with the international trend has surged upward in China. As for the specific model and way, most scholars took financial holding company as the best one. Especially when the firstfinancial holding company------CITIC Group established in December of2002, upon consent by CPC central committee and State Council, many financial institutions and industrial groups wanted to have a try in this area. But all the practice in the area is not standard and norm. Moreimportantly, the legislation of our country is a blank too in the supervision on financial holding company. So, it is an urgent task to take research on the risk-management and supervision of financial holding company of China. The aim of our research is to give necessary theoretical support to the establishment and normalization of financial holding company in China.Chapter 1 of this thesis takes introduction to some basic problems about financial holding company, including the definition, the process of production and development in some developed countries and advantages and disadvantages of financial holding company to other traditional financial institutions. In chapter 2, the author makes analysis to the general and special risks of financial holding company. Against these risks, chapter 3 puts forward mechanism to take precautions against the risks and the mechanism includes internal risk control and external supervision. On the basis of the former 3 chapters, the last chapter takes discussion emphatically on some focuses about the financial holding company in China. In this chapter, the author carries on introduction and analysis to the situation of financial holding company in China, and then points out some routes to develop China's financial holding company. Finally, some suggestions on the supervision of financial holding company in China would be put forward.