Study On Risk Management Of CMBC’s Private Banking Business

Some people have got lots of fortune with the rapid development of China’s economy. Private banking came out to help these rich men to manage their fortune, and it’s becoming the key business for every commercial bank. Risk management plays an important role in private banking. CMBC (China Minsheng Banking Corp. Ltd.) has explored its own risk management, which fits its own business development and bank business, to obtain some achievements. Although CMBC is leading the design of relevant system and mechanism in China, there are still some common and special problems. It’s important to study these problems and propose measures, which is helpful to learn the influence of China’s economy development on banking, and explore its own way for banks in China’s economic development and social transformation.Several methods were used in the paper to study the risk management of CMBC private banking such as documentary analysis, on-the-spot observing method, qualitative analytic method and quota analytic method. There are three key parts in the paper.The first part is about relevant theoretical review. Private banking business, risk management theory and some important types of risks related to private banking are reviewed.Development status of CMBC private banking and its risk management are discussed in the second part. There are four sections in detail:1General description of CMBC;2Development of CMBC private banking;3Risk management of CMBC private banking;4Some problems in risk management of CMBC private banking and their causes.In the third part, overall scheme design is performed for the risk management of CMBC private banking based on risk management theory. Six aspects are considered including clearing objectives in risk management, establishing enterprise-wide risk management system, improving risk measurement, focusing on evaluation and feedback afterwards, improving inner management and cultivating risk management culture.There are two contributions in this paper. Overall scheme design is performed for the risk management of CMBC private banking considering risk management objectives, risk measurement, evaluation and feedback, inner management and risk management culture. Some measures and system establishment to achieve the risk management objective are discussed.