I. Introduction to Risk Management and Control
Risk management and control means that risk managers take various measures and methods to reduce the possibility of risk events or reduce the losses caused by risk events. ? The four basic methods of risk control are: risk avoidance, loss control, risk transfer and risk retention.
Second, the control means
Therefore, commercial banks in China are facing many risks. How to control the risk at a low level has become an urgent requirement for the development and growth of commercial banks in China. The practice of the development of modern commercial banks proves that risk control cannot be separated from the development of commercial banks themselves. Controlling and reducing risks is precisely for the better development of commercial banks themselves.
Only banks with stable and compliant operations and excellent asset quality can truly retain and continuously attract high-quality customers with development potential and have lasting vitality. Banks with poor asset quality are increasingly burdened, and non-performing assets erode profits, which not only fails to attract high-quality customers, but also loses better customers.
At present, China's commercial banks urgently need to establish a healthy and robust risk control system.
Control system and independence
I. Control system
The development experience of western developed commercial banks shows that most commercial banks with good risk control have a common feature, that is, they have not only established a perfect risk management system, but also established a vertical risk control institutional system. Specifically, we should set up a risk control committee at the head office level, with the chief risk control officer of the whole bank as the chairman of this committee.
At the same time, each business department and each branch has a risk control officer, but they are all responsible to the risk control officer at the next higher level, not to the person in charge of the same business department.
Second, independence.
This independence is not only manifested in the independence of risk control from market development, but also in three aspects: program control, internal audit and legal management. From the point of view of procedural control, it includes: adopting appropriate accounting policies, determining the appropriate proportion of bad debt provision, internal reporting and external reporting.
From the perspective of internal audit, it includes: establishing control and management policies, testing the completeness of control procedures, and confirming that the internal operation methods of banks meet the requirements of external supervision; From the perspective of legal management, it includes: banking activities meet the legal requirements, keeping in touch with regulatory authorities, providing contract texts for business activities, and prompting the risk of default.