| Liquidity is a base of banks as well as one of the most important basic principles.Liquidity management is to coordinate the profitability and security, and to defuse an important means of bank payment risk, which is also one of the core of the commercial banks.Due to extensive and complex causes, Liquidity risk is regarded as a comprehensive risk. Its risk management is more difficult. Typically, in addition to the liquidity risk management, it should also manage other types of major risks. Therefore, the level of liquidity risk management reflects the overall business conditions and risks of commercial banks ability to cope. Mobility issues are not well, the bank may face a liquidity crisis. In particular, liquidity risk is more destructive compared with other risks. liquidity crisis caused panic and runs the risk of potentially triggering the financial crisis and social unrest. Therefore, regardless of national or commercial bank must pay close attention to liquidity management issues.As an important result of Reform and Opening, small and medium commercial banks play an important role in the financial system. In recent years, small and medium banks is developing rapidly, but is more susceptible to interest rate fluctuations, coupled with small assets relatively, simple structure, the maturity mismatch of assets and liabilities and other factors,which make banks face greater liquidity risk in Interest rate marketization, also makes its liquidity management be different from the large commercial banks. Interest rate reform in the future make liquidity management a major problem of small and medium banks. In addition, liquidity is also one of the main problems of the world’s financial system. To study it has a theoretical and practical significance. Since the financial crisis, states have think highly of the liquidity and management of commercial banks. On october 12 th, 2011, the CBRC issued "Commercial Bank Liquidity Risk Management(tentative)", which clears four main indicators of the supervisory liquidity for banks: coverage of liquidity, liquidity ratio, loan to deposit ratio and net stable financing ratio.In this context, we selected representative case of Minsheng Bank. In accordance with its annual financial report and its liquidity position, we try to put forward relevant policies and proposals. Firstly, liquidity management theory was reviewed, liquidity management system was combed. Secondly, we analyse the liquidity risk that faced by Minsheng Bank, then to calculate the liquidity gap, analyze the face of liquidity risk reasons. Again, combined with the status quo of the Minsheng Bank and other small and medium-sized commercial banks’ liquidity management, we set up the mobility of management indicator system for the discussion of the comprehensive survey of the Minsheng Bank’s liquidity management issues. Finally, policy recommendations to improve the liquidity management of the Minsheng Bank, to sum up the perfect idea of the index system of small and medium-sized commercial banks’ liquidity management.The main conclusions of this paper are: the external environment has adversely affected the liquidity of the Minsheng Bank, but the main cause of liquidity risk is the accumulation of problems and contradictions in their own long-term development. The proportion of company’s business is too large, and the proportion of individual business partiallow, which resulting in the one hand, its lack of stable long-term sources of funds other hand, medium-and long-term loan growth too fast, making the assets and liabilities do not match, and induce a greater liquidity risk. To address these risks, this paper presents a proposal for the vigorously developing the intermediary business, change the mode of operation and profitability models, while actively developing retail banking. In recent years, the Minsheng Bank’s liquidity management level gradually increased, but there is a big problem. Minsheng Bank in various time periods, the liquidity gap, the existence of large deposits of the instability is the main cause of Minsheng Bank is facing liquidity pressures, the bank’s profitability be limited due to the instability of this part of the deposits have not been fully utilized. Overall, the Minsheng Bank’s risk control framework is sound, but due to narrow the scope of the financial management, liquidity risk on a regular basis reporting system is imperfect, technical measures to be perfect and other reasons, the status of its liquidity management is not optimistic, there are many inadequate. Efforts to improve the Minsheng Bank’s liquidity management from the operational level, policy level and institutional level, the core is designed to strengthen the liquidity management framework and enhance the ability to execute.Compared with previous studies, this paper has three main features: firstly, based on financial data, combined with the 2003-2011 data, we systematically, we studied Minsheng Bank and other small and medium-sized commercial bank and summed up the causes and characteristics of its liquidity risk.Secondly, when measure of liquidity risk, we not only use general liquidity measure, but also introduced a foreign index. We re-build liquidity management indicators of Minsheng Bank and other small and medium-sized commercial banks, which is less in the past. Thirdly, in the case of Minsheng Bank to deal with liquidity risk analysis, we use a mobility gap law sub-period analysis, and fully integrate the different ideas of some of the current popular theory. We take a comprehensive survey and case studies to find problems and strategies of China’s small and medium-sized commercial banks’ liquidity management system. |
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