A Study On Risk Management Of Commercial Banks' Bill Business

In China,the bill enjoys a history of 40 years since it formally entered the circulation field as a currency credit symbol during the Reform and Opening up till now.From the trial to popularization period,the bill business plays an increasingly more important role in our national economic development.On the one hand,in the new era of national economic development entering the new normal phase as well as reform and innovation entering a deep water zone,the bill business offers lenient support and convenience that promote the real economy transformation and effectively solve financing difficulties of small and medium-sized enterprises.On the other hand,being an important measure of asset allocation,the bill business is conductive to the development of commercial banks as it helps the banks to promote financing,to obtain a reasonable control of credit scale and to spur profit growth.However,with the rapid development of the bill business,the significance of risk management in economic market increased and its necessity becomes more and more prominent as there are more bursting points of risks and wider range of risk prevention and control due to imperfect bank risk management mechanisms,loose operation process,artificially controlled business process,invalid background check and amplified effects of mistakes after frequent circulation.Therefore,we should properly recognize the risky situation of the bill business and strengthen the risk management of commercial banks' bill business.During the actual business process,although some commercial banks have taken further measures such as establishing a valid risk management system,the bill business itself contains a lot of risks and there are violations of bills' essential requirements that seriously restrict the sustainable development of the bill business,such as acceptance,discount or rediscount risks due to practitioners' lack of risk awareness or professional abilities.Moreover,with the advance of interest rate liberalization,the market where the uncertain factors that lead to interest rate turbulence occurs much more frequently bears higher risks of inverse ratio of costs and benefits caused by discount of bills.This thesis studies the potential risks of the bill business and summarizes bills' basic concept and influence as well as related theories of bills in reality and its non-causative nature.Based on a thoughtful analysis of the risks currently faced by domestic and foreign commercial banks in the process of the bill business,the thesis starts with discussion about the corresponding risks of different types of bills including acceptance,discount,rediscount,collection risks and then points out six major challenges in risk management of our commercial banks such as risk control mechanism,business operation system,risk contingency plan,criminal penalties,market risk management and application of credit system,combining the current situation of the bill business home and abroad.It also uses four specific cases as practical evidence to support the theoretical research.This thesis is concluded that commercial banks in the current situation should take two-way countermeasures of constructing external market environment and at the same time,optimizing internal business environment for the bill business and offers eleven specific measures,aiming to solve practical problems with the research and to find a risk management breakthrough in the balance of efficiency and security.