The International Experience On Legal Supervision Of Shadow Banking And Its Enlightenment To China

Since the1980s, with the coming of the asset securitization frenzy and all kindsof financial derivatives, non-bank financial institutions flourished. Instead of thetraditional bank-dominated financial system, the market-based financial system isincreasingly becoming the trend of the development of the financial world becauseof its inherent advantages. It is more than six years from that financial crisis whichoriginated in the United States and then swept the globe, but people are stillfanatically getting to the root of the matter: what is the strength? Which makes usstill can’t get out of the haze, particularly in the US? U.S. economist Paul Krugmanbelieves that it is shadow banking system which has never been or less beenregulated, rather than traditional banks which is fully supervised is the core of thecrisis. Since2007, McCulley put forward for the first time in the Fed’s economicconference,"shadow banking" and "shadow banking system" terms like began tobe popular in the whole world, all countries and international organizations discussand research the concept, characteristics and legal supervision of shadow banking. Inthe post-crisis era, the legal supervision on shadow banking has become the focus ofnations and international organizations. In2010, during the G20Seoul summit, theG20leaders also warned that financial potential gaps would appear in shadowbanking system. Quickly, shadow banking was on the Financial Stability Board(FSB) and the International Monetary Fund (IMF) and other international financialorganization’s agenda.Under the international and domestic background of the development of shadowbanking, this paper firstly clearly defines the intension and extension of shadowbanking system, to explicit the concept of shadow banking. Here, creatively classifythe extension of shadow banking, namely, the forms of shadow banking, breaking theimperfection of previous introduction using enumeration method, to be morecomplete and clear. Then, it makes an in-depth analysis of the legal characteristics ofshadow banking and its dual effects on the financial system. Previously, there is noscholars making in-depth analyses of the role of shadow banking in the financialsystem from both sides, they are generally only concerned about the negative risksbrought by shadow banking, and do not realize its positive effects on the financial system. Then it gets an objective and comprehensive summary of the status andproblems of the legal supervision of China’s shadow banking, to find the problem.Later, with a global perspective, to dig the legal supervision experience of shadowbanking of a few advanced countries and international organizations. Finally, throughdraw lessons from international experience and combine them with the feature ofChina’ financial environment, to look for the thinking and countermeasures of thelegal supervision of China’s shadow banking, and to solve the problem. It is a longway to face up to the positive role of shadow banking to the financial system, torealize its negative effects, and actively to explore effective regulatory path. WithChina’s economic take-off and let-go of the domestic financial market, and thediverse and changeable form of China’s shadow banking, it is urgent to analyze thecurrent situation of China’s shadow banking, and draw lessons from internationalexperience to strengthen the legal supervision of China’s shadow banking, and makeshadow banking supervision and the traditional bank supervision for double-track,altogether to build the stability and development of China’s financial system.