The Internal Control System And Risk Management Of Foreign Banks In China

After China joining WTO,the international economic business over the world is increasing.Foreign banks soon realized the chance of Chinese financial market and joined in to seek new development path,which means the globalization development is deepening.To make profit in China,foreign banks have to face the brand-new financial markets.And it also means foreign banks will face all kinds of new test.Especially during the 2 financial crisis,the financial industry was facing huge challenge and pressure.At the same time,the entry of foreign Banks into the Chinese market has made the competition in China's banking industry more and more fierce and cruel.Facing the heavy competition,Chinese Banks need to set up a comprehensive and effective internal control system to manage the risk,ensure the healthy and stable running.However,although the internal control system of Chinese Banks is in constantly improvement,problems still exist and financial cases usually occur,which has made more or less loss to our bank.Foreign Banks have long experience of internal control and the rich resources of the mother bank,so the internal control and risk management is more mature,scientific,effective,which are our Chinese Banks can learn from.Only by further improving the internal control system,our bank can increase the effectiveness of risk management and promote the healthy and stable development of the whole banking industry and boost the financial market.Based on M Banks as the research object,using the method of theory and case,the internal control and risk management of the foreign capital bank in China,M,was analyzed completely.And the author used the analytic hierarchy process(AHP)to evaluate the M bank's risk management control level and reveals the advantages and characteristics of M bank internal control,thus to discover a place worth to learn from Chinese Banks.Finally,the conclusion is as following:1)the internal control and risk management system of foreign Banks is relatively scientific and effective.2)Banks in China can improve organizational structure,establish scientific and effective internal control and risk management system,clear post division of labor and mutual restriction relations,optimizing the human resource management and incentive constraint mechanism,establishing perfect independent internal audit and internal control evaluation system,to promote domestic bank internal control level and to increase the effect.