CBRC releases bank liquidity risk management guidelines for stress tests

Xinhua Beijing, October 29 (Li Fangfang, Liu Shiping) China Banking Regulatory Commission 29th issued the "Commercial Bank Liquidity Risk Management guidelines" in order to continuously improve the commercial bank liquidity risk management level, guide commercial banks to fully pay attention to and strive to maintain liquidity adequacy, to ensure the safe and sound operation of our banking sector. Liquidity risk refers to the risk that a commercial bank may not be able to obtain sufficient funds in time or obtain sufficient funds in time to cope with the growth of the assets or to pay the maturing debts. If the liquidity risk cannot be effectively controlled, the solvency of Commercial bank will be harmed.　　Liquidity risk management is the whole process of identifying, measuring, monitoring and controlling liquidity risk. The guidelines require that the frequency of stress testing by commercial banks be commensurate with their size, risk level and market impact, but that regular stress tests should be conducted at least quarterly. Temporary and special stress tests should be carried out for specific pressure scenarios in the event of market volatility or the requirements of the CBRC.　　The pressure test of commercial Bank should be carried out in a separate currency on the basis of the table, and the pressure test should be carried out separately for the relevant regional branches or sub-banks in the special circumstances such as liquidity transfer limitation. The guideline stipulates that the board of commercial banks bears the ultimate responsibility for liquidity risk management, and the senior management of commercial banks is responsible for the specific management of liquidity risk.　　The Board of Supervisors (supervisors) shall supervise and evaluate the performance of the boards and senior management in the management of liquidity risk, and report to the general Meeting (shareholders) at least once a year on the performance of the board and senior management in the management of liquidity risk. It is understood that the CBRC has always maintained the liquidity adequacy of commercial banks as an important aspect of day-to-day supervision, through the establishment of 75% of the deposit and loan ratio High-limit, carry out pressure testing, guide the optimization of credit structure and so on to ensure adequate liquidity.　　At present, China's commercial banks have a higher overall liquidity level, the National interbank lending market liquidity is abundant, to the end of September this year, the National Commercial bank liquidity ratio averaged 41.7%, much higher than the 25% minimum regulatory requirements. The head of the CBRC pointed out that commercial banks should adhere to the principle of prudence, fully identify, effectively measure, continuously monitor and properly control the bank as a whole and in all products, business lines, business links, all levels of liquidity risk, to ensure that commercial banks in the normal operating environment or under pressure State,　　Have sufficient funds to deal with the growth of assets and the payment of maturing debt.　　The official said that the "guide" not only for commercial banks to improve the level of liquidity risk management to provide the basis and guidance, but also to promote the commercial banks to do a good job of the new capital Accord implementation of the preparatory work, as well as supervision and inspection to provide standards. Industry insiders believe that the outbreak of the international financial crisis, highlighting the importance and necessity of strengthening liquidity risk management. The enactment of the guideline is helpful to further improve the risk management system of our commercial banks, which will be a new impetus to the sustainable and healthy development of our commercial banks.