China Banking Regulatory Efficiency

As an important component of the finance medium organization, the banking plays a extremely significant role in modern economy, because it comes together the surplus of the short-term funds belonging to the social public or other organization to be its own funds source and utilizes it through risk combination, which makes itself become the corpus of the exterior margin. Bank supervision means that the Center Bank or other financial supervision bureau, according to the national law and regulations, carries out a series of successive, unified and standard supervision to the banking from market permission, business activity, management condition, behavior norm to the process of withdraw from the market. It also includes the supervision and penalty taken to the person who interferes with the proper financial movement and does business illegally. In other words, bank supervision are measures adopted which will insure that the bank runs prudently and keeps enough funds and reserves to resist the business risk.Excessively strict bank supervision usually emphasizes the safety of the financial system unilaterally, which results in the low efficiency, affects the development of the banking and further the national economy. On the contrary, under the condition of financial liberalism, relaxing supervision will lead to the frequent emergence of the banking crisis. As a result, the contradiction in the development of modern finance, safety and efficiency, comes out in the process of bank supervision .It is usually very hard to consider both sides.There is a close relative between the foundation of efficiency principle in the field of bank supervision and the changes of the modern supervision theory. Although inhibiting and obstructing the development of the banking to some extent, bank supervision promotes bank system to compete fairly and efficiently on the safe and stable foundation .The target of bank supervision is to create a kind of high-efficiency management mechanism, which can encourage competition, urge the bank service to be systematic to operate more smoothly in the market economy and gradually to pay attention to the supervision of bank efficiency.The writer thinks that bank supervision should include two layer contents: the first is that we can protect the interests of the depositor through supervision, improve...