The Special Nature Of Operational Risk In China Commercial Banks

In banking supervision, credit risk and market risk arising from very early on the importance of financial institutions. And in the beginning of the 19th century 70-80, it had already formed relatively mature risk management techniques. In particular for credit risk, from the banks of the first modern day, it was assumed by banks through to profit. However, operational risk, even though the concept has a long history, but it as the bank's risk management is one of the three major risk issues in recent years.Operational risk is the bank on the birth of the existence of risk. They are widely used in the management of banks operating in various fields, which is one of the basis risks. However, its existence has not aroused the attention. In recent years, international and domestic banking major and serious cases occurred by operational risk more or less.It brought huge economic losses and serious damage to the credibility of the banks. These attracted industry and the regulatory authorities'attention. The introduction of the new Basel Committee first brings operational risk to《Basel Capital Accord》. On the credit risk and market risk management, from the 19th century 70-80 in the beginning, it had already formed relatively mature risk management techniques. And it proposed allocation of capital requirements. As they get very early on the importance of the industry, their study will be more. The studies both in theory and practice have all been successful. However, the academia and the industry's research on operational risk have not been given sufficient attention. The operation risk started in the evening, basically from 1995. However, it does not mean that the operational risk is not important. Operational risk in the banking business contains all aspects of the various procedures involved in various business positions and staff of various business lines. From the course of development of the abroad banking sector, operating risk in commercial banks associated with it is not a new topic. Since the 1980s, financial institutions because of operational risk have already lost more than 2000 billion dollars. Basel Committee in 2002 held a global operational risk survey, a total of surveyed banks reported 47,269 from the total loss over 10,000 euros of operational risk events, the average per bank in the incident 528 from operational risk. For its part, in 2005 at the beginning of China's banking sector seems to be about to enter the "troubled times", the financial industry big and important cases frequently escalated. Most of these cases are caused by operational risk. The Chinese Academy of Social Sciences, Li Yang, who is financial director called "the devil in the details", which the New Basel Capital Accord called "operational risk." In other words, China's banking sector facing the risk of the operation is gradually emerging, and the seriousness of the cause for concern. Along with the rapid development of finanacial globalization, marketization and the unceasingly intensification of inter-bank competition, especially with the profound changes of internal management structure and management mechanism resulting from banks'joint-stock system reform, the whole financial operation enviroment has become increasingly complex. For its part, state-owned commercial banks have been gone through 20 years of the reform process, and are now on the substantive and critical phase. However, in financial globalization, the rapid development of derivatives of the background, operational risk will be more complicated and diversified. Therefore, in the current study of commercial banks respond to operational risk is of important strategic significance.This paper elaborated some international typical definitions of operational risk, and revealed the sources and classification of operational risk.Moreover, it gave China's commercial banks operating risk characteristics in light of China's commercial banks operational risk events. The article is the focus on China's commercial banks through the operation of the special nature of the risk research, including operational risk to the special status, special causes and the special need of management, drawing on international Morgan Chase Manhattan Bank and domestic China Construction Bank operational risk management experience, which put forward suggestions to the operating risk management system of China commercial banks. And through the analysis of the large number of cases comes to the following conclusions: operational risk exists in the customer withdrawals and payments of each process, which operational risk exists in the banking business for each process.Economic system and the banking system affecting the commercial banks operating system change is a major cause of long-term operational risk in China. This includes institutional reasons; the existence of systemic risk; banks and other internal control deficiencies; current high-tech crime is important risk factor of the existence of commercial banks operational risk. Therefore, improving the operational risk management system of China's commercial banks must strengthen the internal management of the commercial banks; start building commercial banks internal control system, strengthen personnel training, improve staff quality and get the focus on technological innovation. Then extend of strengthening the out-management, such as strengthening the information disclosure system, strengthening the regulatory functions of the China Banking Regulatory Commission, improving laws and regulations, and other operating risks. On the operational risk measurement, in this paper the author is to give a brief of introduction and explanation but do not involve empirical research. The desired objective of this paper is to be achieved that people can quire a full and clear understanding of the operational risk. And there is an in-depth understanding in China's current status of operational risk, shortcomings and future development system.