The Identification And Control Of Financial Risk For Foreign Banks

In the process of modern commercial bank management, the financial risk is one of the most important problems that can not be avoided. As the market competition intensifies, the financial risk faced by commercial banks is becoming more and more complicated. Financial risk is the objective existence of the commercial banks "management process, it is impossible to completely eliminate the risk and its market impact. To guard against financial risks of commercial banks, we must understand the characteristics and causes of financial risk, and carry out appropriate control and prevention, the risk prevention mechanism to be improved, the purpose is to minimize economic losses, and create the biggest economic benefits for commercial banks. In this paper, the relevant literature on the basis of the relevant literature on the basis of the financial risk identification and control of the target and principle, the principle of wind control is to follow a comprehensive, prudent, effective and independent principle.Financial risk identification of foreign banks not only need to study the data of financial statements but through the normal operation of various departments of the bank, the financial risk in the operation of the bank is the most obvious performance is the capital structure is irrational, the proportion of debt is too high, leading to the emergence of bank funds flow crisis or even bankruptcy. So it is very important to study the influencing factors of financial risk. The five factors that affect the financial risk are credit risk, market risk, liquidity risk, operational risk and capital management. The influence of credit risk which is faced by foreign commercial banks in the business activities of the most important financial risk factors, involving the business mainly: business and personal loans, discount, negotiation, credit, bond and interbank and other and bank profit is from the credit business. Credit business generated financial risk identification focus from the examination and approval process to start research, control must run through with the loan before, after the loan and loan.In 2008,I joined Shinhan Bank (China) Qingdao branch, it has been eight years. I chose my own work unit as the research object, is more advantageous to carry out the thorough careful research, and hoped that proposed to own unit has the constructive opinion and the measure. Shinhan Bank (China) in compliance with the people’s Bank of China and the banking regulatory bureau laws and regulations under steady operation, Shinhan bank to focus any course focused on credit and international business, so financial risk research is the focus in the two aspects of credit and foreign exchange. Credit risk should be established in the relevant mechanisms for the management of credit risk, for different single trading partners or groups of competitors, different industries can accept different risk limits. Monitor the risk status regularly and at least once a year. And the foreign exchange is the exchange rate and foreign currency fluctuations in the interest rate caused by the bank’s financial risk. Commercial banks should match the balance of assets and the sensitivity of monetary risk control over the bank’s set limits, and in exchange rate should be strictly according to the principle of risk management committee, narrowing the interest rate sensitivity gap between assets and liabilities.