Research On Risk Control Of China's Commercial Banks Investment And Loan Linkage

As China's financial reform continues to deepen,the operating environment and competitive structure that our country's commercial banks facing have changed.To adapt to the changing financial markets,commercial banks need to innovate new business growth points actively and adjust their own business models.For a long time,Chinese small and medium-sized enterprises have been facing the problems of narrow financing channels and small amount of financing during the process of science and technology innovation.Under the background of mass entrepreneurship and innovation,Chinese entrepreneurship enterprises with the characteristic of science and technology innovation have increased rapidly,which have put forward more pressing demands on the solution of financing issues.With the advancement of national supply-side reform,the investment and loan linkage will,not only,help ease the difficulty of financing promote the benign development for Chinese small and medium-sized enterprises,but also promote our commercial banks to change into comprehensive operation model so as to improve the market competitiveness for the bank.The investment and loan linkage is a kind of new business to provide financing for the small and medium enterprises.It means that the financial institutions help small and medium-sized enterprises develop through the combination of equity financing and debt financing.Specifically speaking,commercial banks cooperate with venture capital institutions or group subsidiary and subsidiary overseas to form a community interest,and then commercial banks provide credit support as well as financial advisory,capital management or other support services for small and medium-sized enterprises,and venture capital institutions or group subsidiary and subsidiary overseas provide equity investment for the enterprises.These develop a new financing form called the investment and loan linkage,solving the problems of financing difficulties and support the growth for Chinese small and medium-sized enterprises during the process of science and technology innovation.First of all,this paper analyzes the domestic and foreign research results on investment and loan linkage,and summarizes the background and significance of studying the investment and loan linkage business in light of the current situation in China.Through the definition of the investment and loan linkage business concept,it sums up the necessity and significance of carrying out the commercial bank's investment and loan linkage in our country.Then it elaborates the practice of the investment banking linkage between China's commercial banks before and after the trial and concludes that there are four major models in the investment and loan linkage business of China,which including the direct investment model within the commercial bank group,the cooperation model between commercial banks and overseas subsidiaries,the cooperation model between commercial banks and venture capital institutions,industrial fund models which constructed by commercial banks,intermediary service agencies and risk investment institutions.Each model takes a typical institution as its research object,and compares and analyzes the risks of different models of investment and loan linkage services.Secondly,analyzing different models and comparing their risks,it concludes that the investment and loan linkage risks include legal risks,transitive risks,conflicts of interest risks,operational risks,liquidity risks,and credit risks.It analyzes the causes of various risks at the same time.Finally,the paper poses the policy suggestion for risk control according to the different risks and causes for investment and loan linkage business,combing with China's financial environment and the actual situation of commercial banks and overseas experience.For legal risk,we will improve relevant laws and regulations to create a favorable policy environment.In view of the transmission risk,we can establish the risk firewall as well as improve the risk isolation system of investment and loan linkage.In view of the risk of conflict of interest,we should construct a reasonable and effective coordination mechanism.Aiming at the operational risk,we should build professional departments and teams and cultivate the professional qualified team adapting to the investment and loan linkage.In view of liquidity risk,perfect balance management of assets and liabilities,and improve the withdrawal mechanism.Aiming at the credit risk,we should establish the information database of the science and innovation enterprise and strengthen the information disclosure system.we should build a prudent financial regulatory framework and promote the innovation of investment and loan linkage business.