Study On Operational Risk Management Of A Rural Bank

Banks are special enterprises,and rural banks are new types of financial institutions.As the smallest banking institution in terms of assets,it has been 14 year since the establishment of rural banks was approved by the state in 2006.On the one hand,rural banks enjoy the advantages of flexible and efficient legal institutions,but on the other hand,they face the dilemma of "congenital deficiency and acquired malnutrition".Congenital deficiency is reflected in the weak foundation of its corporate governance,and some members of three boards and One Management have insufficient professional quality and energy to perform their duties,which is not conducive to highquality work.Acquired malnutrition is manifested in poor development environment.Most of them are set up in county-level regions with short time of establishment and few branches.Due to limited financial knowledge,the general public doubts that rural banks are "Personal Banks" with low credibility and limited business development.In addition,the departments of rural banks are not set in a comprehensive way,and there are not enough professional and professional staff in important positions,resulting in internal constraints from the organizational structure.In recent years,some rural banks blindly pursue scale and profit,and have been penalized by regulatory authorities for major violations of regulations,mainly involving corporate governance,loan business and inter-bank business.China Banking and Insurance Regulatory Commission has continued to increase its efforts to rectify illegal businesses and implement regulatory policies more strictly.Rural banks have poor risk resistance ability,so they should actively improve their risk management,especially to strengthen operational risk management and ensure compliance and steady operation.A rural bank has been established for 7 years,and the most basic risk it faces in the operation process is operational risk.By analyzing the operational risk management of this rural bank,the paper points out the weakness in corporate governance,internal control system,operational risk identification,and specific operational problems in the operation and management.Then determine factors by using Analytic Hierarchy Process and analyze the reasons for the problem.In the end,this paper puts forward suggestions to improve the executive's awareness and ability of performing duties,improve the internal control system,develop key staff training plan,improve the technology information system,and raise the compliance awareness of all employees.