Thoughts on perfecting China's banking supervision legal system under the background of financial crisis

"If the law is right, there will be success". Strengthening the construction of regulatory laws and regulations is an important guarantee for deepening the reform and opening up of the banking industry. After the establishment of China Banking Regulatory Commission (CBRC), guided by Scientific Outlook on Development, we actively promoted the legal system construction of banking supervision, basically established a commercial banking system that meets the requirements of marketization, established a modern corporate governance mechanism, and effectively promoted the construction of process banks. It can be said that the practical achievements of legal construction directly serve, promote and guarantee the valuable achievements of banking reform and opening up.

With the new situation of China's reform and opening up and the process of banking modernization, the legal system construction of China Bank (3.57%, 0.07% and 2.00%) has gone through four stages: initial establishment, finalization, finalization and perfection. With the continuous efforts of banking supervisors and legal workers, China has initially established a modern banking supervision legal system based on the relevant laws, regulations, resolutions and orders of the central legislature and the central government, with the Banking Supervision and Administration Law and the Commercial Bank Law as the core, the Regulations on Punishment of Financial Violations and the Regulations on the Administration of Foreign Banks as the basis, with departmental regulations and a large number of normative documents as the main body, supplemented by relevant financial judicial interpretations. The hierarchical framework of this system includes: more than 20 laws and related laws; 10 above administrative regulations and related administrative regulations; More than 20 regulations; More than 500 normative documents; More than 70 related judicial interpretations; More than 20 international agreements on banking supervision, and so on. The systematic construction of banking supervision rules not only provides a relatively complete legal basis for the orderly promotion of supervision, but also provides the most reliable institutional guarantee for the stable and rapid development of the banking industry.

Modernization of banking supervision legal system

Based on the practice of banking supervision and drawing lessons from international advanced experience, we have taken scientific and effective legislative measures in recent years, which has effectively promoted the modernization of banking supervision legal system.

Connecting with WTO rules-The legislation of market access supervision follows the principles of "transparency" and "prudence". 200 1 After China's accession to the World Trade Organization, in order to fully fulfill its WTO commitments and further promote the opening-up of the banking industry, the CBRC has formulated a series of regulations to reform and optimize the access supervision mode: canceling a number of market access approval items for commercial banks and senior executives, and simplifying the approval procedures; It is stipulated that overseas financial institutions can invest in Chinese-funded financial institutions, breaking through the long-standing prohibition of overseas financial institutions from investing in Chinese-funded financial institutions; Cancel all non-prudential restrictions on foreign banks, encourage foreign banks to set up branches in China or transform them into corporate banks registered in China, relax the market access standards for foreign banks, cancel the time interval requirement for foreign banks to set up branches, simplify the working capital grades of wholly-owned and joint venture banks in China, and reduce the minimum working capital requirements accordingly; Combing and integrating all kinds of market access management laws and regulations, according to the administrative licensing law, the implementation procedures and specific implementation measures of administrative licensing items of various banking financial institutions were systematically formulated.

Drawing lessons from the experience of international banking supervision —— Continuous supervision legislation guided by "risk-oriented and prudent supervision". The new Basel Capital Accord in 2006 regards capital adequacy ratio requirement, regulatory review mechanism and market constraint as the three pillars to achieve effective supervision. At the same time, among the 25 principles in the revised Core Principles of Effective Banking Supervision, 13 belongs to the principle of prudent banking supervision, which reflects the great progress in the thinking and methods of banking supervision.

Referring to international standards and drawing lessons from the best practices of financial regulatory authorities in developed countries such as Europe and America, the CBRC put forward a new regulatory concept of "managing legal persons, managing risks, managing internal control and improving transparency", and successively formulated and issued a series of financial regulatory laws and regulatory documents, including Measures for the Management of Capital Adequacy Ratio of Commercial Banks, Guidelines for Internal Control of Commercial Banks, Guidelines for Market Risk Management of Commercial Banks, Guidelines for Operational Risk Management of Commercial Banks and Commercial Banks.

Adapting to the needs of banking reform and opening-up-the characteristics of comprehensive supervision legislation are "moderate control, guiding restructuring and promoting innovation". The CBRC insists on doing something different, giving consideration to effective and prudent supervision on the basis of moderate control: partially reducing the access requirements for banking business and senior executives, relaxing the access restrictions for some new businesses, canceling the qualification examination for senior executives and the qualification restrictions for some senior executives; We began to relax the service price management of commercial banks, jointly issued relevant rules with the National Development and Reform Commission, and implemented a service pricing method combining state-guided prices with independent pricing of commercial banks, thus expanding the independent space for service pricing of commercial banks. At the same time, the CBRC has strengthened the risk supervision guidelines and norms for the banking industry. Among the existing banking supervision rules, there are more than 160 supervision rules mainly aimed at prudent operation and risk management of the banking industry, thus establishing a relatively systematic and complete risk supervision rule system.

In addition, in order to meet the practical needs of the shareholding system reform of wholly state-owned commercial banks after 2003 and focus on solving the long-standing problems such as the absence of investors in state-owned banks, the separation of government and enterprises, and the lack of effective corporate governance, the CBRC actively promoted state-owned banks to improve corporate governance, and actively encouraged the introduction of overseas strategic investors with advanced management technology on the basis of the State Council's re-injection of capital to support financial restructuring. At the same time, a series of normative documents, such as "Guidelines on Corporate Governance and Related Supervision of State-owned Commercial Banks", were issued to urge commercial banks to establish an effective internal checks and balances mechanism, so that the rights and interests of owners and stakeholders of commercial banks can be arranged in a balanced system. In order to promote the institutional adjustment, product and business innovation of the financial industry, the CBRC also issued the Guidelines for Financial Innovation of Commercial Banks and other regulations. Formulate and revise the management measures for non-bank financial institutions such as enterprise group finance companies, auto finance companies, financial leasing companies and trust companies; Draft interim provisions regulating organization and behavior, and speed up the restructuring of rural credit cooperatives into rural commercial banks and rural cooperative banks; Six management regulations and work guidelines were issued to standardize the access and management of three new types of rural small and medium-sized financial institutions: village banks, loan companies and rural credit cooperatives, fill the shortcomings of financial services in underdeveloped rural areas and enrich the types of domestic banking financial institutions.

The important relations that should be correctly handled in the legal construction of bank supervision

Constructing the legal system of bank supervision is actually a process of deeply understanding and dealing with the relationship among market subjects, business behavior, supervision and external environment construction. As a regulatory authority, the CBRC has always been guided by Scientific Outlook on Development, trying to handle these contradictions and interrelationships.

The relationship between perfecting regulatory rules and promoting market development. Facts have proved that a market without rules will only lead to an increase in transaction costs and eventually lead to unsustainable transactions. Looking back on the 30-year history of China's reform and opening up, the accumulated financial risks are the result of weak rules and regulations. At present, because there is still a big gap between China's banking industry and foreign mature markets, if the supervision construction can't keep up, it will inevitably breed large-scale default and behavior anomie, and trigger new financial risks. Therefore, the next step is to replace the old rules that are not adapted to the new situation with new scientific rules through reform. In this way, "reform for strength" has become an important starting point for the formulation of banking law. At the same time, we should also grasp the scale and focus of supervision, distinguish between primary and secondary, adhere to the direction of market-oriented reform, do something different, and avoid excessive control affecting financial efficiency.

The relationship between learning from foreign experience and summing up domestic practice. As a post-modern country, an indispensable and important condition is to study and learn from the legislative experience of international banking supervision with a broad world vision and strategic thinking. In the final analysis, learning from foreign countries is to form and create practice with its own characteristics. Only in this way can the construction of laws and regulations have vitality and foresight. On the one hand, actively learn from the relevant documents formulated by the Basel Committee, carefully study the laws and regulations of banking supervision in various countries, and absorb the essence of supervision in all aspects for our use. On the other hand, the relevant laws and regulations should be based on the development stage of the domestic banking industry and the current political system, legal system and banking supervision in the country, and the national conditions should not be ignored or even exceeded the actual development stage.

The relationship between principled supervision and regulatory supervision. With the intensification of competition in the financial market, the gradual improvement of the supervision system and the enhancement of the bank's risk management and control ability, we should gradually shift the supervision thinking to the principle supervision in due course. According to this requirement and direction, we should pay more attention to improving the operating efficiency of the banking industry and building the competitiveness of the banking industry in the future. The introduction of regulatory regulations is more of a guiding requirement, less of a binding rule, more of a principled guidance, and less of a rash restriction. When studying and adopting regulatory measures, we should pay more attention to actual effect and strength, make good use of all kinds of prudent regulatory means and market means, adhere to both punishment and prevention, pay attention to prevention and self-examination, make great efforts to carry out comprehensive rectification, and earnestly urge both the symptoms and the root causes.

The relationship between establishing regulatory authority and regulating the exercise of power. The supervisor is the maker and executor of the legal system of bank supervision, and should establish the supervision authority to ensure that the order is prohibited. The power of modern administrative organs must be restricted by law, otherwise improper exercise of power will inevitably infringe on the legitimate interests of banks and dissolve the regulatory authority. Therefore, on the one hand, laws and regulations should fully empower supervisors to ensure supervision and law enforcement; On the other hand, it is necessary to effectively restrict the supervisors and ensure the seriousness of the exercise of power. Based on the above considerations, the relevant norms regulating the exercise of power have become an inseparable and important part of the legal system of bank supervision.

The relationship between promoting financial innovation and ensuring financial stability. Financial innovation is the source and motive force of financial development. However, financial innovation activities cannot be separated from Scientific Outlook on Development's top priority. It must conform to the development strategy, professional ability and risk management and control ability of financial institutions, and it is necessary to carefully supervise and follow up the innovation activities. Our financial market is still in the primary stage, and various irregular behaviors of market participants occur from time to time. In this context, financial innovation must be based on strict and prudent supervision, and the internal control of financial institutions and market discipline should be promoted through regulatory legislation to better maintain the stable operation of the financial system.

Thoughts on further improving the legal system of bank supervision

We are in an era of rapid innovation and increasingly fierce competition in the financial market. This is both an opportunity and a challenge for the development of China's banking industry and the construction of banking laws and regulations. The supervision department should assess the situation, seize the opportunity, meet the challenge, clarify the relevant policies and legal reform and adjustment ideas, and further improve the legal system of bank supervision.

Improve the dominant legal system to adjust the relationship between financial market subjects. The first thing to do is to adjust the property right system and corporate governance structure of commercial banks in China. In recent years, China has made great progress in market economy development and banking reform, which not only replenished capital for state-owned commercial banks and stripped off non-performing assets, but also learned from international advanced experience in risk control, financial management and salary incentive. However, in the process of designing the market subject system, the reform is mainly carried out according to the will of the government, but the rights and obligations of the subject are not clearly defined according to the principles of private law, which leads to the deep-seated problems such as system and mechanism not being well solved, and the reform needs to be further deepened in many aspects. In the next few years, the law needs to make scientific and clear provisions on the property right system, investor system, shareholders' rights and obligations, shareholders' behavior constraints and corporate governance structure of commercial banks. On the basis of profoundly clarifying social relations, we should clarify the position of banks as commercial subjects in the market at the level of private law, protect their autonomy rights, and safeguard the market's choice of market subjects and the allocation of financial resources.

Build an open market access system and cultivate multi-level financial market players. Banking is a limited licensed industry, so it is absolutely necessary and reasonable for China's banking industry to implement a strict access system. However, too high entry threshold will easily lead to market monopoly. The existing financial institutions in China are strikingly similar in service model, organizational structure, business model, service object, product design, business process and so on, with serious homogeneity and insufficient supply power. Therefore, how to achieve economic equality is an important aspect of perfecting China's banking legal system in the future. Deregulation, as a long-term trend of international government management, is very important to the development of banking industry. On the one hand, the richness of financial institutions can make high-quality capital enter the banking industry and improve the development strength of China's banking industry; On the other hand, various financial institutions can provide different products and realize diversified services, thus solving the contradiction between supply and demand in the financial market.

Learn from the advanced practices of international banking supervision and constantly improve the laws and regulations on risk supervision. In line with the principle of "improving strategy, foresight and effectiveness", we will pay close attention to the new trends of international regulatory laws and regulations, attach importance to learning from the good practices of international banking regulatory legislation, and gradually implement international best practices. For example, the implementation of "International Agreement for the Unification of Capital Measurement and Capital Standards: Revised Framework" by countries all over the world will have a great impact on us. China should consider its own national conditions and further study how to create conditions for the gradual implementation of the new agreement. For another example, the release of International Accounting Standards No.39 by the International Accounting Standards Board will have a shock and impact on all walks of life in the world, especially on the calculation of capital adequacy ratio of commercial banks, the provision of loan loss reserves and asset securitization, which will be a great challenge to China's banking industry. Another example is the revision of the Core Principles of Effective Banking Supervision and the Corporate Governance Principles of OECD by the Basel Committee on Banking Supervision, which is closely related to the development trend of banking supervision and reform. In addition, there are international laws and regulations such as anti-money laundering and anti-terrorist financing, which need to be tracked in time.

Seriously sum up the lessons of the American financial crisis and improve our legal policies. Since 2008, the impact of the subprime mortgage crisis in the United States has further emerged and evolved into a worldwide financial crisis. It has brought profound lessons in business philosophy, business innovation, risk management, danger signs, market constraints, financial supervision, crisis response, rescue mechanism and many other aspects, which are worthy of our close tracking and research. We must discover the problems and weak links in China's banking supervision policy and legal system in time, strive for or seek the best favorable opportunity, and make remedies and precautions as soon as possible.