Commercial Bank Off-balance Sheet Activities Risk Management Issues Based On JS Bank

The modern market economy situation develop rapidly.The financial market has gradually become integrated.Financial products business,asset securitization business,innovative financial instruments and other off-balance sheet(OBS)activities sought after by the public.In the 1980 s,at the time of the economic situation,the business volume of the global commercial banks began to become smaller and the profits declined.At this time,the off-balance sheet activities of Western commercial banks showed a blowout trend.Then,the off-balance sheet activities in the banking sector showed a significant upward trend in business,and accompanied by high profit margins.In fact,the rapid develop ment of off-balance sheet activities in recent years is the inevitable result of fierce competition in the banking industry.Off-balance sheet activities are flexibility and less capital,so that it is popular in domestic and foreign commercial banks.In recent years,the development of off-balance sheet activities in China's commercial banks is in a good condition.But compared with the western commercial banks,the off-balance sheet activities of commercial banks in China is still in small scale,low traffic volume and low transparency.Therefore,the risk of off-balance sheet activities management and control have created some obstacles.The integration strategy of international integration and cross-regional operation makes the risks faced by commercial banks increasingly complicated and the demand for banking risk management is increasingly high.And the risk of off-balance-sheet activities is generally greater than that of traditional business.The potential risks contained in off-balance sheet activities will be transformed into actual risks and affect assets and liabilities under some certain conditions.If used improperly,the risks are enormous,leading to a banking crisis and even a generate financial system risk.In order to make our off-balance sheet activities in the commercial banks develop legally,properly and orderly,it is necessary to deeply understand its basic concepts,development status,classifications and characteristics.At the same time,banks should master the classification,characteristics and management methods of the off-balance sheet activities risk,which will help expand the scope of off-balance sheet activities of China's commercial banks and promote the healthy and sustainable development.This paper first reviewed the above contents and then using JS bank as an example,to understand the JS bank off-balance sheet activities,JS bank off-balance sheet activitiesmain risks and risk management measures.At last,this paper analyzes some problems in risk managements of off-balance sheet activities in JS bank.The customer's credit rating is not accurate.Asset securitization accounting is not reasonable.Management layer risk management initiatives deviate from internal control.There is not enough risk identification capability for off-balance sheet activities in JS bank.This paper get thorough understanding and analysis of the causes of these four problems,and then get comparative analysis of M bank risk management of advanced experience.M bank off-balance sheet activities development concept is more advanced.The market share is relatively large.The business type is relatively complete and the customer group quality is higher.Especially,the M bank has a holding period of the balance sheet business tending to be short,takes the balance of operating leverage and financial leverage ratio,concentrates derivatives category table business transaction and uses hierarchical structure to improve these characteristics of credit at the level of sheet business risk management,so that M bank off-balance sheet activities development than other banks to develop more quickly.On the basis of the above analysis and research,this paper puts forward the corresponding countermeasures and suggestions for the improvement of the existing off-balance sheet activities risk management methods of JS Bank.First,to establish and improve the early warning and control of credit risk.Second,strengthen internal control to deal with the lag of external regulations.Third strict management of the operating level sales off-balance sheet activities products.Last,strengthen the talent and technology reserves,standardize the relevant processes and systems.The healthy and orderly development of the off-balance sheet activities of commercial banks in China requires the joint efforts of commercial banks.The commercial banks should examine the situation of their off-balance shee activities with reference to the relevant suggestions and establish and improve the risk management system of off-balance sheet activities.In the future,good business bank off-balance sheet activities will have an important impact on China's financial market,contribute to China's financial market environment prosperity,is conducive to the promotion of social market economy.