On Innovative Financial Management and Service

Finance is the lifeblood and core of the national economy. At present, the financial industry is facing all kinds of complicated risks. This paper analyzes the causes of financial risks faced by China's financial industry at present, and makes a brief talk on the innovative financial management and services provided by Youxue.com.

Reasons why the financial industry faces financial risks

As the lifeblood and core of the national economy, financial industry plays a very important role in the allocation of resources in contemporary countries. The so-called risk, in short, refers to an act that may bring both benefits and losses. Then, financial risk refers to "the uncertainty or possibility of economic subjects suffering losses in financial activities." In other words, the probability that the expected return of an economic entity deviates from the actual return in financial activities. "Generally speaking, financial risks are hidden in financial activities under the market economy environment and can only be controlled within a certain limit. Once the risk is too large, financial risks will break out and even lead to financial crisis.

So, what are the main reasons why the financial industry is facing financial risks? Can be analyzed from the following points.

First, judging from the layout and development of the financial industry, there is a problem of simplification in China's financial industry at present.

In China, since the implementation of bank restructuring, several major state-owned banks in China are still in an absolute dominant position in capital allocation, and there has been no change. The capital chain is mainly controlled by state-owned commercial banks, and the financing channel is single. Due to the lack of investment channels for the masses, more people choose to deposit money in the bank in the face of the rising cost of food, clothing, housing and transportation. At the same time, if an enterprise wants to develop, it must have a high ability to absorb external funds. However, due to the restriction of state-owned commercial banks, direct financing cannot develop freely, and people lack investment channels. Enterprises can only survive and develop by borrowing from commercial banks. This leads to a single financing channel and rigid structure, which makes the bank risk at a high level.

Second, from the operational point of view, financial institutions have operational risks.

Operational risk, as its name implies, refers to the risks existing in the actual operation process, which is manifested in the financial industry and is the risk generated in the daily business operation of banks. This operational risk is manifested in the following points: first, the personal quality risk of financial industry staff; Secondly, the business operation process lacks standardization and has no rules to follow. Financial activities are multi-agent interactive economic activities, all aiming at profit. Due to different interests, financial activities are alienated.

Thirdly, from the change of interest rate, there is an increasing interest rate risk in China's financial industry.

In China, due to the strict control of the process of interest rate marketization, commercial banks cannot adjust interest rates independently. The change of interest rate is uniformly and systematically scheduled, which brings greater systemic interest rate risk. Today, the process of interest rate marketization is imperative, and the fluctuation of bank interest rate will become frequent. Because banks' assets and liabilities mainly exist in the form of financial products, they are greatly influenced by changes in interest rates. Since then, in the process of interest rate marketization, due to the lack of ability of financial institutions to cope with interest rate fluctuations, interest rate risks will be brought.

Fourth, from the perspective of credit, financial institutions always have credit risks.

Credit risk management is the primary goal of bank risk management, because credit risk generally exists in banks. Commercial banks generally have the impulse to over-lend, because the more loans, the bigger the business, and may eventually get a good return. However, there is a risk of blind lending. Because most of the lent funds flow to high-risk industries, it is easy to form bad debts and bad debts, which implies huge financial risks. From the borrower's point of view, they are also looking for various means to meet their own interests, so as to try their best to avoid the obligation to repay the loan and pass the risk on to the bank, so that the bank can bear the losses. As a result, there have been many phenomena, such as risk transfer, loan fraud, loan default and so on, which have increased the credit risk of banks.

Fifth, from the perspective of financial liberalization, the proliferation of various financial institutions has formed the risk of liberalization.

With more and more funds in the hands of ordinary people, the state began to relax the control of the financial market, which promoted the development of the banking industry. In addition, some people also use various means to absorb scattered funds and form underground financial markets, while some small and medium-sized enterprises are easy to seek informal financial channels such as underground financial markets when it is difficult to raise funds from formal financial channels. And those formal financial institutions also need to get more benefits than before liberalization, so it is easier to engage in risky activities.

Promote the healthy and sustainable development of the financial industry through innovative financial management and services. Talking about innovative financial management and services, I hope it will help everyone.