Analysis And Countermeasures To The Capital Of Foreign Currency Of Chinese State-owned Commercial Banks

Chinese State-owned Commercial banks is confronted with a great loss on their capital of foreign currency under the background of founding a new RMB exchange rate mechanism and the process of continuous appreciation of the RMB. This paper does a research on the capital of foreign currency of the commercial banks in a comprehensive and systematic way at the very first time, analyzing the reasons for the devaluation risks to the commercial banks' capital of foreign currency on three aspects: why it takes a long time to the process of the appreciation of RMB and is inevitable, the mismatch of currency and the restrictions of capital flow. Then I give some countermeasures to the commercial banks on the purpose of solving the problems, including utilizing and developing the QDII instruments, hedging risks through the financial derivatives, adjusting the structure of the combination of foreign currency, expanding the overseas business and implementing overseas acquisition policy. They are practical and meaningful to the commercial banks, also, they provide some illuminative ideas to the discussion in theory.