General risks of network finance
Source: Shangpin China |
Type: website encyclopedia |
Time: September 29, 2014
What are closely related to the network Website Design , online finance, online shopping, etc. The network financial institutions represented by the network bank have general risks such as liquidity risk, credit risk, market risk and interest rate risk in the course of operation. As online finance uses different ways to expand and innovate financial service businesses and tools from traditional finance, this virtual financial touch service business has formed a borderless financial service feature that breaks through geographical boundaries, so the performance and characteristics of the above risks are different from traditional finance.
（1） Liquidity risk
Taking banks as an example, it is the basic feature and traditional business of commercial banks to raise funds in debt business and use funds in asset business to earn interest margins. Therefore, the ratio of assets and liabilities of banks must be reasonable to solve the balance between profitability, liquidity and security. Liquidity here refers to the liquidity of an asset without loss. The higher the liquidity, the better the security of assets (the lower the risk), and the higher the efficiency of capital use. If the liquidity of assets is insufficient, once the customer withdraws cash and runs, the bank will face crisis or even bankruptcy. The Commercial Bank Law of China stipulates that the proportion of loan balance and deposit balance of commercial banks shall not exceed 75%, and the proportion of liquid asset balance and liquid liability balance shall not be less than 25%. This is the significance.
Liquidity risk exists objectively for any commercial bank. When the online bank invests in the electronic currency it sells and the customer requests to redeem the electronic currency, the assets invested by the online bank may not be realized quickly, or may cause significant losses, thus exposing the online bank to liquidity risk. In general, Internet banks often fall into a credit crisis due to the vicious circle of liquidity risk, and eventually lead to the bankruptcy and failure of Internet banks. If no collateral is required, how can we guarantee the smooth recovery of the loan? If security mortgage is required, what kind of security mortgage form and assets are required? If the guarantee is provided in the form of guarantee, how does the bank review the credit standing and guarantee ability of the guarantor? If customers are allowed to provide guarantees (such as mortgages and pledges), how are the guarantee procedures carried out? These problems should be fully considered when banks carry out network loan business. Some foreign online banks evaluate the borrower's credit rating by means of remote communication and credit confirmation procedures, but the borrower is likely to fail to perform the obligations that should be undertaken for electronic currency lending, or the credit risk of online banks is greatly increased due to the unsound credit evaluation system of the bank where the borrower's online registration is located. In addition, online banking loans, on the surface, are still the same as the traditional loan business, and only involve banks and customers. However, their subject characteristics of transactions through the Internet involve many parties, including customers themselves, network system operators, communication line providers Computer manufacturers and many other stakeholders may be involved. Because these relationships are extremely complex and lack of unified and effective legal adjustment and norms, once economic disputes such as credit risk occur, it is difficult to divide and confirm economic responsibilities, and the credit risks faced by commercial banks will increase greatly.
（2） Credit risk
Still taking the bank as an example, credit risk refers to the risk that the lender cannot fully fulfill its repayment obligation on the maturity date, thus causing loss of loan principal or interest to the commercial bank. Commercial banks generally take measures to prevent the occurrence of loan risks, such as strengthening the review of customer credit, supervising the use of funds, and withdrawing bad debt reserves. Internet banks are also faced with credit risk, which is mainly manifested by loan risk. Its particularity lies in that the loan of online bank is realized through the network. Whether the information is tampered with or the loan is falsely claimed, it will certainly affect the customer's confidence in the online loan business. For commercial banks whose credit is more important than everything else, this will cause huge credit risks. Traditional commercial banks usually require customers to provide guarantees, mortgages or pledges to transfer or reduce risk losses when carrying out traditional loan business. In the online banking loan business, does it need to provide guarantee? Is collateral required?
（3） Market risk
It refers to the possibility of losses on the assets and liabilities on and off the balance sheet of online financial institutions due to market price changes due to different positions or mismatched portfolios, such as exchange rate risk caused by foreign exchange rate changes. Generally speaking, the risks of Internet financial institutions engaged in foreign exchange business are much greater than those of local currency business. The operating losses caused by foreign exchange risk will not only endanger the financial institutions themselves, but also have a direct negative impact on the national balance of payments, foreign exchange reserves and foreign debt. In addition, changes in the prices of major commodities in the international market, as well as macroeconomic and financial policy adjustments and changes in economic conditions of major inter-bank settlement currency issuers, also constitute market risks for online financial institutions.
（4） Interest rate risk
It refers to the possibility of network financial institutions suffering losses due to interest rate changes. Internet financial institutions that provide electronic money may depreciate their assets relative to their liabilities due to adverse changes in interest rates. Therefore, Internet financial institutions will bear a relatively high interest rate risk. In addition, due to the network environment, the flow of international hot money will be faster. With the change of interest rates, such large, short-term, and highly liquid funds will flow from low interest rate regions to high interest rate regions. Large scale and rapid flow of people will affect the assets and liabilities of online financial institutions and the balance of payments of a country The stability of the domestic financial market has a significant adverse impact.
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