RESEARCH OF OPERATINOAL RISK MANAGEMENT AND ITS DETERMINANTS: AN ANALYSIS OF HUA XIA BANK IN CHINA

Zhuang Xie

MPRA Paper from University Library of Munich, Germany

Abstract: With the development of science and technology and economy, more and more financial intermediaries are appearing in the financial market to ensure more efficient and stable processes in the financial system. As the main part of financial intermediary, the bank plays a vital role in the whole financial market system. In recent years, China's banking industry has been developing rapidly, but there are many potential problems, such as the operational risk management. At the present stage, the operational risk management authority of China's commercial banks is overly centralized, there is no clear loan risk responsibility system, and no effective long-term credit mechanism has been established, and the problem of non-performing loans still exists. This paper takes Hua Xia Bank as the objective of study and its analysis of the data based on its annual report between 2013 to 2017. The result of analysis shows that the ratio of firm-specific factor which can influence operating ratio mostly is leverage. Moreover, for the macroeconomic part, the significant influential factor is GDP. Therefore, this study suggest the bank should manage the leverage ratio effectively and efficiently for preforming well in the operational risk management.

Keywords: operating ratio; leverage; GDP (search for similar items in EconPapers)
JEL-codes: G21 (search for similar items in EconPapers)
Date: 2018-12-16
New Economics Papers: this item is included in nep-rmg and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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