Consideration For Building Macro-prudential Financial Management System

Since the U.S. financial crisis in2008, several countries started to reform and perfect their financial supervision mechanism, attempted to eliminate regulatory problems and defects exposed in the current round of crisis, and strived to build the central bank-led macro-prudential financial regulatory system. At the same time, China’s financial sector development was relatively fast, but the systemic risk of financial sector was increasing, because of the deepening of international practice, mixed operation initially apparent, increasing the complexity of the financial system and global economic uncertainty. Under the current circumstances, the state proposed "Twelfth Five-Year Plan" to build China’s counter-cyclical macro-prudential management system. Around the goals, we will study, learn and absorb the mature experience of Europe and the United States financial regulatory reform; improve financial regulatory system, mechanisms and measures; build the central bank-led macro-prudential financial regulatory system. This is also an urgent requirement of China’s financial sector.The paper tries to explore the possibility to build a macro-prudential financial regulatory system, by improving the functions of the central bank. In addition to the introduction and conclusion, the body of this article consists of four parts.Firstly, the financial regulatory theory, especially the domestic and international macro-prudential management theory research, is comb to clarify the financial macro-prudential management concepts, tools and frameworks.Secondly, by analyzing of the sources of systemic risk, including the economic cycle adjustment, real estate risk, exchange rate fluctuations, mixed operation, and empirical analysis of the People’s Bank of macro-prudential management policy effects, deficiencies of current financial regulatory is found to discuss the necessity and urgency of building a macro-prudential management system.Thirdly, by drawing on the financial regulatory reform experience of the United States, Britain, Germany and other countries, including the role of central banks in financial macro-prudential management system, macro and micro prudential means match, the systemic risk monitoring and financial consumer protection, as well as combining with the reality of China, these are proved to be suited to China’s practical,Finally, the paper presents the idea of building our financial macro-prudential management system, including guiding ideological, organizational structure, the target system, frame structure, as well as demonstrates the "leader" status of central bank of macro-prudential management system, specially elaborates the optimization direction of central bank functions under the macro-prudential management system.(l)The central bank which should be the main body of the macro-prudential management has the power to study and formulate policies and tools;(2)Payment system regulatory authority of the central bank should be extended in order to achieve the full supervision of the payment system;(3) The central bank should establish and oversee the deposit insurance system, so as to improve the emergency liquidity support and disposal of problem financial institutions regime. Meanwhile, the central bank should have the discretion to provide emergency liquidity support to financial institutions;(4) The central bank should unify financial consumer protection duties.