Selection on Regulation Model of China Financial Holding Company
|School||Tianjin University of Finance and Economics|
|Keywords||Financial Holding Company Regulation Model Financial Crisis|
Recently financial holding company has become main trend of international finance. Because of more complex equity relationship, related transaction, interest conflicts and more creatively financial derivatives, these all make the risks of financial holding company increasing. The current financial crisis has showed that currently the financial regulation systems in many countries exist the problems that they have been not suitable for the development of financial holding company to some extent. Recently the development of financial holding company has been still in the initial stage, and China financial industry has been regulated by separate supervision. This kind of "regulation vacuum" can create the huge danger to the whole national economy. This paper has used comparative method, example method and literature method. Combined with the latest development in global financial holding companies, I put forward my own point of view on financial holding company regulation of China. Firstly this article shows the economic basis of financial holding company from the aspects of negative externalities, public goods nature of free competition paradox and incomplete information of financial holding company, i.e. market failure theory, and it makes a theoretical groundwork for the whole article. Secondly the author lists the international rules of financial holding company from " Principles on Supervision of Financial Holding Company " and "Group 20 Financial Summit in London ", and compares with three types of theoretical regulation models, i.e. agency-based regulatory approach, function-based regulatory approach and goal-based regulatory approach and US, UK and EU of practical regulation models respectively. Thirdly according to the outstanding problems on the internal and external regulation of China financial holding company, the author gives the suggestions on capital adequacy ratio, corporate governance structure, related transaction, interest conflicts, information sharing, risk control, law system, coordination of financial supervision, financial market structure and international cooperation. Finally this paper has drawn the lessons from three types of theoretical regulatory approach and US, UK and EU of practical regulation models after this financial crisis and given some suggestions on internal and external regulation models for China financial holding company.