Assets Managed And The Empirical Study Of Chinese Commercial Banks' Risk Management

The essay analyzed the feasibility and necessity for domestic commercial bank to develop custody business to control the financial risk. Custody is a business with low risk and high profits, development of it is helpful to reduce the financial risk, and lay a solid foundation for the bank strength. It meets the requirement of reform with China's commercial banks nowadays.The paper first describes the characteristics, purpose and content of asset custody business. Then describes the reason leading to the financial risk of commercial bank. Finally I use commercial bank risk management theory to analyze their relationship and point out that custody business can lower the financial risk of commercial bank occurred. Those risks are caused as the outside and inside reasons, and they can be transferred or avoided. Custody business has root in safety and independence, which is helpful to protect market in order, control the risk inside of the bank, increase capital adequacy ratio. Chinese bank can achieve a healthy financial market by means of that.This article also analyzes the status of foreign and local custodian banks. Abroad, most of the custodian bank has advanced a comprehensive legal system and risk control system. Their experiences and lessons are helpful for local banks. Domestic custody business develops very rapidly in recent years due to the leadership of capital market. However, there still exists some problem: The current regulations are not standard enough to control the custody business well. In addition, the business of local custodian bank is too simple. What's more, the cultivation of human resources and technology also needs to be further improved.On that basis, the article combined with China's actual situation and put forward some suggestions to control the financial risks. On the legal side, the regulations need to be strengthened; on the business side, commercial banks should actively expand the scope of custody business; the bank should also to introduce the personnel and technology. Finally, China's commercial banks need to strengthen the competition and cooperation with foreign banks, and eventually enter the circle of global custodian.The full text is divided into seven chapters. First chapter introduces the background, research value as well as the logic structure. Second chapter gives an outlook over the foreign and domestic research of the custody business of commercial bank. The full text of Chapter three is key point of the whole essay, it focuses on relationship between financial risk management and commercial banks, and noted that custody business can effectively resolve these financial risks. Chapters four and five, respectively, introduced the status of local and foreign business custody business. Chapter six provides a case with further evidence of the theme. Chapter seven put forwards some proposals to improve the custody business of commercial bank.