Supervision Of Financial Groups In China To Study

The past thirty years has witnessed increasing consolidation of financial industry, deregulation and globalization, which have fuelled rapid growth in the large, multi-line financial conglomerates. Pursuant to the definition of the Joint Forum (1999), a financial conglomerate is any group of companies under common control whose exclusive or predominant activities consists of providing significant services in at least two different financial sectors (banking, insurance and securities). Despite the increasing significance of financial conglomerates, the regulatory structure in most jurisdictions is still largely based around single business lines, on the notion that financial institutions, or their business lines, can be classified as banks, or insurance companies or securities firms. This is particularly true in the regulatory approach to capital adequacy.The approach put forward by the Joint Forum mainly focuses on the issue of avoiding overstatement of capital, and therefore its measuring techniques that mostly deal with double or multiple gearing of capital within a financial group, have neither solved regulatory inconsistency which may cause regulatory arbitrage, nor touched on the issue of aggregation relating to risk and benefit diversification effect of financial conglomerates. The Joint Forum (1999) approach has included the unregulated subsidiaries in the measurement of capital by adopting Notional Capital Proxy, but Notional Capital Proxy can only be applied to the calculation of the regulatory capital for the unregulated subsidiaries whose activities are similar to regulated entities but not to the calculation of the regulatory capital for unregulated non-financial entities. At present, China is still the implementation of separate operation, separate supervision of the financial system, but whatever we are in the international environment, domestic or existing form of financial holding companies, the group management of financial services industry is a general trend. Based on this background, first of all we define financial conglomerates from the theoretical level, and analyze the development of financial conglomerates motivation from both internal and external points. Then we focus on the capital regulation of financial conglomerates, first we set banks and insurance companies as an example, from the perspective of both theoretical and empirical we analyze the capital adequacy ratio requirement of financial institution on a stand-alone basis, and we put forward an attempt to unify the regulatory capital of financial conglomerates. Because of related party transactions are a special risk of financial conglomerates, the thesis describes mainly from three aspects such as the public disclosure of information,monitoring the implementation of tables and associated risk of transmission. We establish the regulatory framework of China's financial conglomerate transactions based on China's actual situation. In the final chapter of this thesis has come to the conclusion of mode on regulation of financial conglomerates based on China's national conditions: the main mode of a number of monitoring regulation for the sub-industry. The Central Bank is responsible for the overall level (the parent company level) supervision of financial conglomerates, including capital adequacy ratio, risk assessment, information disclosure, etc.; At the same time, the Central Bank of China coordinate the Banking Regulatory Commission, the Securities and Futures Commission and the China Insurance Regulatory Commission.