Research On The Income And Risks Of Carbon Finance Products In Commercial Banks

The development of low-carbon economy is the key to building a low-carbon civil society,and the development of carbon finance in commercial banks is the main driving force for the construction of a low-carbon economy.Commercial banks are involved in carbon finance business with their unique status and unique functions,and carbon finance product is an important part of development of carbon finance business in commercial bank.As an emerging business,the carbon finance products business is conducive to the innovation of off-balance-sheet business of commercial bank and it's helpful to improve the income of intermediary business.In addition,it can enhance the comprehensive capacity of commercial bank,and it's also beneficial to accelerating the pace of low-carbon economic construction.The carbon finance products launched by commercial bank are conducive to controlling the emission of harmful gases such as carbon dioxide.However,as a structured product,the current development of carbon finance products in China is not plain sailing,and their revenue and risk structure are more complicated when compared with the traditional finance products.Under this background,the study of the revenue and risk status of carbon finance products and the causes is conducive to evaluating the development of carbon finance product objectively,meanwhile,it provides a basis for the stable development of carbon finance product and promotes the development of carbon finance products business in commercial bank healthily and sustainably.Based on the theoretical analysis of carbon finance products,this paper considers that the revenue of carbon financial products consists of fixed income and floating income,then takes a carbon finance structured deposit product issued by Industrial Bank as a typical case to analyze,the fixed income and the floating income are respectively calculated by discounting method and GARCH(1,1)model combined with BS option pricing method.The results of the research show that the products issued by Industrial Bank belongs to the issue of discount,the maximum possible loss of floating part of income is 11.64%.The existence of the risks is related to the immature market of carbon finance established in China and the not-standardized carbon financial transaction system.In addition,this paper analyzes the risks of carbon finance products systematically during their existence,and the research results show that due to the special nature of carbon finance trading markets,carbon finance products have the risk of policy system and carbon finance initiative,management risk and liquidity risk.Accordingly,this paper puts forward some countermeasures and suggestions to promote the development of carbon finance product in commercial banks healthily and rapidly.