I. Analysis on the Operation of Major International Commercial Banks in 2003
1, running performance
In 2003, the loan quality of American big banks further improved, and the non-performing asset ratio of the whole industry dropped from the highest point 1.27% in September 2002 to 0.94% at the end of 2003. European banks' income from traditional business (interest) and intermediate business (non-interest) has maintained rapid growth, while Japanese banks are slowly coming out of the trough, and their capital adequacy ratio has been significantly improved.
By the end of 2003, the average capital adequacy ratio of the top 20 commercial banks in the world reached 12%, total assets increased by over 9.3%, profits increased by over 20%, earnings per share increased by 15%, and operating expenses decreased by 1%. From June, 5438 to October, 2004, JPMorgan Chase merged with the First Bank, and the combined total assets reached $65,438 +0. 1 trillion, making it the second largest commercial bank in the United States after Citibank. See table 1 for some financial data of major western commercial banks.
2. Competitive advantage of core business
Citibank's competitive advantage business: foreign exchange business, retail finance and asset management. It is the largest bond issuing company in the world, and the global bond and stock underwriting ranks first in the world for two consecutive years; HSBC: Personal Finance, Trade Finance and SME Services. E-banking has developed rapidly; JPMorgan Chase: Global wholesale (syndicated loan) and consumer finance business. It has an absolute market leading position in arranging and providing risk management business; Bank of America: global wholesale, local retail. Its derivative products and liability management consulting business ranks first in the world; BNP Paribas: retail, international trade financing services, investment banking. It is a major retail bank in Europe, and its interest rate and credit derivatives market are in the forefront. Deutsche Bank: Asset Management and Investment Bank. Investment banking business is developed.
Second, the characteristics of the development of international commercial banks in recent years
(1) Maintain sufficient core capital and expand the scale of assets.
The enhancement of their own risk awareness and the improvement of risk and capital supervision standards of banking regulators have prompted western commercial banks to improve their management to improve their capital adequacy ratio and operational efficiency: according to the core capital ranking, the core capital ratio of the top 100 banks in the world is close to 20%. The capital adequacy ratios of HSBC Holdings and Citibank both exceed 65,438+02%. On this basis, the assets of HSBC and Citibank increased by 30Vc and 65,438+08% respectively last year.
(B) M&A has created a broad profit space.
Since 1993, there have been at least 28 mergers between banks ranked within 200 in the world. In recent years, the M&A activities of major international banks are shown in Table 2. The reasons for the upsurge of international banking M&A are as follows: First, to reduce the cost of banks and pursue economies of scale; The second is to expand the scale of banks and enhance their competitiveness; Third, improve the comprehensive efficiency of banks and realize complementary advantages; The fourth is to save crisis banks and guard against financial risks.
(3) Expand investment banking business.
The increasing investment banking business has become a common feature of the world's major commercial banks. Investment banking has improved its business and asset structure while making short-term profits. In 2002, the corporate business and investment banking business of HSBC achieved a pre-tax profit of $37/kloc-0.70 billion, accounting for13 of the total profit. In 2003, the income of JPMorgan Chase Bank from investment banking business was $3.7 billion, compared with $3 billion in the previous year. Two-thirds of Deutsche Bank's income comes from investment banking, which is the general direction of the group's future development;
(4) Comprehensive management
Driven by the pressure and interests of horizontal competition, the business operations of western commercial banks gradually tend to be integrated through financial innovation. Mainly as follows:
1. Mixed operation: At present, most western commercial banks can operate not only traditional banking business, but also investment banking business such as corporate bond underwriting and corporate investment. The universal bank of "financial supermarket" has become the general trend of western commercial banks.
2. Bank asset securitization: Western commercial banks reduce credit risk through credit asset securitization. Using the platform of corporate syndicated loans, most of the credit risks can be transferred to non-bank investment institutions, including insurance companies, mutual funds, pension funds, hedge funds and other securitization tools. In recent years, the bond market based on bank assets in the United States and Europe has expanded rapidly, especially in Europe, with an annual growth rate as high as 50%. In the securitization market of bank credit in the United States and Europe, the bank assets that are often used to support the issuance of securities are: housing mortgage, consumer credit, corporate credit, trade settlement vouchers and so on.
3. Integrated management of assets and liabilities: In order to realize integrated management of assets and liabilities, western commercial banks have taken many measures to optimize the structure of assets and liabilities, such as reducing the proportion of interbank lending and loans in total assets and correspondingly increasing the proportion of securities. Commercial banks choose the ideal investment portfolio according to their own business objectives, which can not only reach the income level of bank loans, but also have flexibility and liquidity, and can make corresponding adjustments at any time according to changes in the market environment.
(e) globalization of business
The main business areas of western commercial banks are: commercial banking, consumer banking, capital market business and asset management business. Capital market business includes syndicated loans, asset securitization, leveraged financing, project financing, agency business, risk management, underwriting of high-yield bonds and stocks, mergers and acquisitions, financial consulting and management consulting. Asset management business includes personal trust, securities brokerage, mutual fund, insurance, corporate trust, etc.
The globalization of commercial banks began in the 1970s. After nearly 30 years of development, some internationally renowned banks' overseas assets and overseas business yields far exceed their own. According to the statistics of British Banker magazine, by the end of 2002, there were 15 large commercial banks in the world, and their overseas assets accounted for more than 50% of their total assets. (See Table 3)
Third, the development trend of international commercial banking business
(1) Retail business
The focus of retail business development has shifted from asset business to intermediate business to expand the non-interest income of banks. At first, the retail business was mainly based on consumer credit, including housing mortgage loans and durable consumer goods loans. With the basic satisfaction of the demand for housing and durable consumer goods, commercial banks began to use idle funds in consumers' hands to develop intermediary businesses, such as foreign exchange investment, stock investment and fund investment. , to meet the various needs of customers.
The service mode has changed from branches to electronic banking services, including automatic teller machines (ATMs), telephone banking and online banking. According to the comparative study of bank transaction costs of different distribution channels in the United States, online transaction costs are only110 of branch transactions. The combination of online transaction and ATM in retail business is the general trend and will become a competitive tool for banks with few outlets.
(2) Business of the company
Providing financial management services for enterprises has become the focus of future banking business, with emphasis on cash management. High value-added financial services mainly include: determining and quantifying risk exposure and establishing hedging strategies; Derivatives trading; Provide technical support and related services for the company's liquidity management such as cash concentration and interest spread; Real-time balance report of trading and payment accounts, research and analysis of foreign exchange trading market, investment decision in money market and other information and consulting related services. Combining liquidity management with asset risk management can not only enhance the liquidity and profitability of customer assets, but also enhance the security.
(3) Intermediate business
The intermediary business of commercial banks in western countries covers traditional banking business, trust business, investment banking business, mutual fund business and insurance business. Intermediary business income has become the main source of its operating income, and the intermediary business income of Citibank and Morgan Bank has reached more than 80% of the total income. In the future, the development of intermediary business of international banks will present "five major changes":
1. Transition from separate operation to mixed operation. The boundary between commercial banks and non-bank financial institutions is becoming increasingly blurred, and the development of intermediary business has involved stocks, securities, insurance and other fields.
2. Change from never occupying or directly occupying customer funds to occupying customer funds. When some intermediary businesses provide services, banks can temporarily occupy the funds entrusted by customers and expand the sources of funds, thus changing the value of balance sheets, promoting the development of asset-liability businesses and forming the interaction between intermediary businesses and asset-liability businesses.
3. Accept the entrustment of customers and sell credit conversion to banks. Commercial banks will provide bank credit when handling credit visa, acceptance, draft and other businesses. The handling fee charged by the bank is not only the embodiment of the bank's operating efficiency, but also the compensation for credit sales.
4. The fees charged for not taking risks become taking risks. Commercial banks need to use funds and bear certain risks in handling intermediary business, such as various guarantees, promises, custody, acceptance, drafts, etc. At this time, in addition to labor remuneration, the fees charged by banks also include interest compensation and risk compensation.
5. Transform from traditional business to innovative business. In order to avoid risks, enhance asset liquidity, improve competitiveness and profitability, commercial banks have achieved breakthroughs in traditional business, covering many fields such as management, guarantee, financing, derivative financial instruments, such as note issuance facilities, currency or interest rate swaps, futures options and so on.
risk management
1. Gradually shift from credit risk management to comprehensive risk management. The new Basel Capital Accord clearly puts forward that operational risk and market risk should be included in the scope of capital supervision, and puts forward different calculation methods for credit risk and operational risk. For banks with different risk management capabilities, different methods are adopted to deal with credit risk, including standard method, primary internal rating method and advanced internal rating method. The new agreement puts forward three specific schemes to quantify operational risk: basic index method, standard method and advanced measurement method.
2. Standardize information disclosure. The New Capital Accord lists market constraint as the third pillar of bank risk management, especially emphasizes the importance of information disclosure, and formulates specific qualitative and quantitative information disclosure contents in four aspects: scope of application, capital composition, risk disclosure evaluation and management procedures, and capital adequacy ratio. The introduction of this market mechanism is the embodiment of the great progress made in the study of modern corporate governance structure, which urges banks to maintain sufficient capital level and cooperate and support the work of regulatory authorities more effectively.
3. Improve the internal risk rating system. In the new capital accord, in addition to retaining external rating as a way to obtain asset rating, it is emphasized that banks should establish internal risk assessment system. From the experience of international big banks, the role of internal rating in credit risk management is mainly to provide an important basis for determining the price of financial instruments, as a basis for drawing bad debt reserves and allocating economic capital, as a basis for customers' comprehensive credit granting and as a reference for managers' risk decision-making.
(E) Financial innovation
The financial innovation of western banks mainly includes three aspects: financial derivatives, bank asset securitization and on-balance-sheet business innovation. The development of financial derivatives can be roughly divided into three categories: derivatives designed for hedging, such as floating interest rate bills, upper and lower interest rates, forwards, options and interest rate swaps; Derivative products aimed at increasing the liquidity of assets, such as loan right exchange transactions and asset transfer contracts; Derivative crystals designed to expand investment and industrial investment, such as loans and bonds that can be converted into company stocks. Securitized financial instruments have developed from traditional on-balance-sheet securitization (such as mortgage bonds) to off-balance-sheet securitization (mortgage-guaranteed or asset-backed securities). On-balance-sheet business innovation is the innovation of deposit instruments, such as money market mutual funds and NOW accounts; The second is the innovation of payment tools; Third, asset business innovation, such as negotiable loan securities, equity loans, flexible repayment of loans, etc. Fourth, the innovation of financing tools, such as various stocks, bonds, trust tools and portfolio financing tools.
Four. The influence of the development trend of international commercial banks on our bank
(1) Comprehensive business functions are an important basis for competition in the banking market.
Mixed operation is the result of competition. In order to make ourselves more competitive, we try our best to provide "one-stop" services for corporate customers, such as loans, settlement, underwriting, consulting and international business. For individual customers, we should strive to provide all-round services such as deposit, settlement, valet financing, safe deposit box and insurance. For customers, all-round service can be more convenient, save time and effectively reduce costs. For commercial banks, this all-round service provides more profit points. Through cross-selling, they can formulate more flexible price charging policies and improve their profitability and core competitiveness.
"Almighty" does not mean "big and complete". "All-round" can be achieved through effective cooperation and outsourcing of financial institutions. From the experience of international big banks, on the one hand, they maintain their core advantages in certain professional fields (such as credit cards, international business, credit business, etc.). On the other hand, outsourcing some non-core advantages or cooperating with other financial institutions is an important principle of their business.
For our bank, the necessary functions are indispensable if we want to build a development financial institution with world-class market performance. While striving for more financial services, we will actively cooperate with other commercial banks or financial institutions to expand business functions.
(B) Excellent risk management ability is an important guarantee for the survival of banks.
Under the background of securitization, globalization and omnipotence, the risks faced by banks themselves are becoming more and more complicated, and customers also ask banks to help them cope with various risks (such as managing money on behalf of customers). In this situation, whether it has excellent risk management ability and active risk management methods has become an important condition for the healthy development and long-term survival of banks.
For our bank, the current market environment is very severe. On the surface, there are many kinds of business, but the profit is not much, and the proportion of non-performing assets remains high. First of all, we should strengthen the research on the new Basel Capital Accord and establish a comprehensive risk management system in combination with the actual situation of banks. Secondly, we should regularly check the risk management of existing businesses and establish an evaluation and control mechanism to prevent major mistakes. Third, we should attach importance to new business, business promotion and risk management. Fourthly, we should allocate some strength to research and develop new business products that banks are developing or approving, so as to nip risks in the bud.
(3) Excellent talents and good technology are the necessary conditions for the development of banks.
Traditional banks rely on brands and funds, but with the development of financial liberalization and increasingly fierce competition, the banking industry has increasingly become a technology-intensive and knowledge-intensive industry, and excellent financial talents and technology are one of the most important core competitiveness of banks. Although the world-famous large or super-large banks have different forms and fields in terms of core competitiveness, the similarity is the perfect combination of financial technology and customer needs, which is based on high-quality financial talents.
The contribution of financial technology and talent building to bank profits will not be immediate in the short term. For our bank, on the one hand, we should make a scientific and reasonable plan for financial technology and talent construction from a long-term perspective; On the other hand, while strengthening the introduction of high-quality urgently needed talents, we should also strengthen the training of existing employees in various new business knowledge and qualities to adapt them to the new situation and needs.