An Research On Funds Transfer Pricing Model In Bank H

With the continuous advancement of interest rate marketization process in China,China's commercial banks began to show up in the way of scale oriented development.Although both scale and operating income have grown up,it also shows the disadvantages of decreasing profitability and increasing interest rate risk,especially in city commercial banks.Therefore,it is of great significance for city commercial banks to learn from foreign commercial banks' experience and establish a set of internal funds transfer pricing management mechanism which is suitable for city commercial banks to raisethe product pricing ability,perfect the performance appraisal,improve profitability,optimize the resource allocation,strip the interest rate riskand realize the comprehensive asset liability management.Funds transfer pricing,refers to the internal pricing mechanism that the liabilities absorption unit transfers the absorbed funds to the fund center(also known as the Treasurer)through the way of compensated payments and in full amount,the fund center charges interest from the fund using unit and pays interest to the liabilities absorption unit.It is a highly effective tool for the commercial banks to carry out fine management.As Chinese markethas not yet fully realized the interest rate marketization,at the same time,eachcommercial bank has great differences in the structure of assets and liabilities,customer structure,information technology system and development strategy,it is unable to rapidly replicate each other.Based on funds transfer pricing theory,this paper combines theoretical analysis with the specific situation of bank H.It detaillyexplains the pricing scope,pricing object,pricing approach and yield curve of bank H,and comprehensively analyzes the realization of internal funds transfer pricing.Finally,this paper analyzes theoptimization impact of bank H product pricing,interest rate risk management,loan-to-deposit ratio after the implementation of internal fund transfer pricing,and puts forward further recommendations.