Study On The Impact On Financial Derivatives Trading Risk Of Listed Banks In China

Since the 1980 s, with the degree of liberalization of financial deepening banking Western countries has slowly shifted to non-interest income primarily related to business from the traditional deposit and loan business, especially commercial banks, financial derivatives use, is set off a wave of inter-bank business expansion has become an important part of commercial banks operating profits. But with the development of the derivatives, the risk is also quietly accumulate, the world’s major banks on derivatives illegal operations are not uncommon. Since the 2008 subprime mortgage crisis, derivatives risk control has become an important issue banking countries to guard against financial risks. China’s banking financial derivatives trading started late, at this stage of development is still at the primary level, banking transactions in derivatives and risk control mechanisms for external supervision is relatively low. Derivatives are the bank balance sheet business in a very important part of our country to enhance the overall competitiveness of the banking sector plays an important role, so the study of financial derivatives trading has important practical significance influence on the risk of China’s commercial banks.Firstly, this paper analyzes the theoretical basis of the financial derivatives trading, and expounds the theoretical basis of the financial derivatives and the mechanism of the bank risk.followed by analysis of the current situation of China’s banking derivatives trading, a detailed description of the background of China’s commercial banking and financial derivatives trading, variety, size and problems. Our empirical analysis in this paper is based on a sample of 16 listed banks, making the regression results using panel data model, there is a positive correlation was found between the risk of banks listed banks and the use of financial derivatives, namely banking and financial derivatives trading increased the level of risk banks. Finally, this paper studies these chapters, from talent management, internal control and external supervision three aspects relevant policy recommendations.