Research On The Construction Of Supervisory Model For Related Party Transactions In China's Financial Holding Companies

In the context of financial liberalization and advancement of information technology,the boundaries between global banks,securities,and insurance industries have gradually blurred,and the advantages of comprehensive operations in the financial industry have become increasingly apparent.Financial holding companies have shown significant advantages over single commercial financial institutions.Its financing costs are low and its business portfolio is relatively coordinated,which has a significant role in promoting economic integration and financial innovation.China's financial holding companies have developed rapidly in recent years.In addition to central enterprises and other organizations actively exploring the establishment of a number of financial holding companies,many local governments have also actively participated in the integration of financial assets such as local pawns,guarantees,and small loans.layout.According to incomplete statistics,as of the end of 2018,there were more than 90 various financial holding companies in China.In essence,a financial holding company is an affiliated company,and the holding subsidiaries are interconnected,and the development of internal related transactions is extremely convenient.As the group continues to expand,financial holding companies have not only gained economies of scale and scope,but also exposed potential risks under regulatory gaps.In May 2019,the Bank of Tomorrow's subcontractor bank was taken over by the CBRC due to the risk of credit defaultcaused by related party transactions.The occurrence of this incident made the supervision of related parties' transactions of financial holding companies arousing industry attention.Through the analysis of the case of the Baoshang Bank,this paper finds that"Tomorrow",in order to reduce financing costs,controls the Baoshang bank layer by layer through a cross-shared network.The Baoshang bank is in the position of a holding subsidiary and is forced to accept " Tomorrow's capital control,its profitability continues to decline,its capital adequacy ratio is lower than regulatory standards,and its non-performing loan ratio and non-performing loan balance are under "double-rising" pressure,which indicates that there is a loophole in the supervision of financial holding companies.At the same time,by analyzing the current status of related party transactions of listed financial holding companies in China,it is found that the total amount of transactions of financial holding companies has been in a continuous growth in the past five years,involving a significant increase in the amount,and frequently occurs between specific related parties.According to the summary,it is found that the related transactions of China's financial holding companies have problems such as the absence of regulatory regulations,unclear regulatory bodies,and confused regulatory methods and paths.Therefore,on the basis of foreign experience in the supervision of related party transactions,this article analyzes the characteristics of China's current regulatory system and current regulatory issues,and designs the supervision model of related party transactions in China's financial holding companies.From the perspective of designing the supervision content and supervision implementation mechanism,and promulgating supervision laws and regulations to ensure the legitimacy and authority of supervision,the People's Bank of China is set as a group-level supervisor to control the establishment,change,suspension and business scope of the parent company of a financial holding company;The CBRC,the China Securities Regulatory Commission,and the State Administration of Foreign Exchange,as functional supervisors,are "umbrella-like" supervision mechanisms for the supervision of financial institutionswithin their respective scopes of supervision."External supervision + internal control" two-dimensional supervision to achieve full penetration supervision of connected transactions.At the end of the dissertation,I propose reasonable suggestions for improving the supervision of related party transactions in financial holding companies in China.