金融英語證書

1、.PAGE ：.；PAGE 10金融英語證書Part1 overview of the financial industry in ChinaThey play a unique role in the economy through mobilizing savings, allocating capital funds to finance productive investment, transmitting monetary policy, providing a payment system and transforming risks.The state council decid

2、ed to make the PBC as a central bank which was characterized by a mono-bank engaged in both policy and commercial banking operations.The government introduced a comprehensive package of measures aimed at restoring financial order as well as addressing the inflationary pressure and signs of overheati

3、ng, particularly in the real estate sector and the stock markets.The reform since then has been focused on developing a sound and robust financial system to guard against and dissolve financial risks, cleaning up the balance-sheets of the banks, improving their ownership structure, strengthening the

4、ir corporate governance, developing market infrastructure, enhancing supervisory capacity, and further opening the banking sector to foreign participation.The wholly state-owned commercial banks, namely, restructuring their balance sheets, establishing corporate governance, transforming their operat

5、ional mechanisms, inviting strategic investors, listing them in stock markets.Apart from the traditional deposit taking and lending business, commercial banks now offer a broad range of intermediary services such as international settlement, bankcards, personal banking, and financial consulting. As

6、the economy becomes increasingly complex, there is an emerging need for developing universal banking.Until recently, foreign banking institutions were only allowed to operate in the special economic zones and coastal cities. To encourage competition form foreign financial institutions, China has exp

7、anded the list of areas open to foreign banking establishments to include all large cities throughout the country. The banking institutions are now engaged in local currency business in 25 major cities.Strengthening baking supervision has become a universal task. Many countries including some advanc

8、ed economies have been penalized for weak financial supervision. For china, this task is particularly relevant, as the authorities are well aware that the Chinese financial system is faced with risks associated with economic transition, in addition to credit and market risks common to all countriesC

9、ontinued progress in structural reform in the financial sector will contribute to the viability of commercial banks. First, further interest rate liberalization will enhance banks capacity for risk pricing. Second, freer cross-border capital movement will allow them to seek high returns and diversif

10、y risks on a much broader horizon. Third, greater exchange rate flexibility will facilitate expansion of foreign exchange business and foster their ability to manage foreign exchange risks.Shares are certificates or book entries representing ownership in a corporation or similar entity.Bonds are wri

11、tten evidences of debts.The primary market is that part of the capital market that deals with the issuance of new securities. The second market is the financial market for trading of securities that have already been issued in an initial private or public offering.Bonds are forms of borrowing firms

12、can undertake in the form of medium or long-term security, which commits them to specific repayment dates, with fixed on variable interest.Treasury bonds, also known as T-bonds, refer to coupon bearing government securities with a relatively longer maturity.In practice, not all risks can be insured,

13、 and the insurability of a given risk depends on a number of factors:1. Losses are measurable in monetary terms.2. Only pure risks are insurable,3. The insurer must be able to collect together a sufficiently large group of separate and independent exposure units which are subject to broadly similar

14、risks. This is so that the Law of Large Numbers can operate effectively.4. Losses must be fortuitous.Part2 First, the key objective of supervision is to maintain stability and public confidence in the financial system.The second goal of bank supervision is to ensure that banks operate in a safe and

15、sound manner and that they hold capital and reserves sufficient to cover the risks that may arise in their business.Third, a related goal is to protect depositors funds and if any bank should fail, to minimize the losses to be absorbed by the deposit insurance fund.The fourth goal of bank supervisio

16、n is to foster an efficient and competitive banking system that is responsive to the publics need for high quality financial services at reasonable cost.The fifth and final goal of bank supervision is to ensure compliance with banking laws and regulations.Risks of bankCredit riskA major type of risk

17、 that banks face is credit risk or the failure of a counterpart to perform according to a contractual arrangement.Two specific elements of market risk are foreign exchange risk and interest rate riskBanks face a risk of losses in on- and off-balance sheet positions arising from movements in exchange

18、 rates.Interest rate risk refers to the exposure of a banks financial condition to adverse movements in interest rates.Liquidity riskLiquidity risk arises from the inability of a bank to accommodate decreases in liabilities or to fund increases in assets.Operational riskThe most important types of o

19、perational risk involve breakdowns in internal controls and corporate governance.Legal risk Banks are subject to various forms of legal risk, including inadequate or incorrect legal advice or documentation that may result in unexpected decline in the value of assets or unexpected increase in the val

20、ue of liabilities.Reputation riskReputation risk arises from operational failures, failure to comply with relevant laws and regulations, or other sources.Prudential requirements cover a broad spectrum process. Of which, there are five key areas where the extensive prudential policies have been imple

21、mented by bank regulators of most countries; these are capital adequacy, risk concentration, asset quality, liquidity and internal controls.Minimum capital adequacy ratios are necessary to reduce the risk of loss to depositors, creditors and other stakeholder of the bank and to help supervisors purs

22、ue the overall stability of the banking industry.The 1988 Basel accord The accord sets minimum capital ratio requirements for internationally active banks of 4% capital and 8%total capital in relation to risk-weighted assets.Tier 1 capital is core capital, that is, common shares, plus non-cumulative

23、 perpetual preferred shares, plus disclosed reserves, less goodwill.Tier 2 capital consists of undisclosed asset revaluation, and general provisions (general loan-loss) reserves, as well as hybrid debt capital instruments, and subordinated term debt.These limits are usually expressed in terms of a p

24、ercentage of bank capital and, although they vary, 25% of capital is typically the most that a bank or banking group may extend to a private sector non-bank borrower or a group of closely related borrowers without specific supervisory approval.Asset quality is the most important factor in determining a banks creditworthiness.In addition to loans, balances due from banks, acceptances and bills of exchange held, as well as commitments liabilities which subject a bank to credit risk are also classified in the same way in order to give a better pict