Opinion Leaders | China Financial Journal
Author | Wang Wengang 'Secretary of the Party Committee and Director of Hebei Supervision Bureau of the State Financial Supervision and Administration Bureau'
The proposal of "five major supervisions" (institutional supervision, behavioral supervision, functional supervision, penetrating supervision, and continuous supervision) points out the direction for strengthening and improving modern financial supervision. The Hebei Supervision Bureau of the State Financial Supervision and Administration has deeply learned and understood the meaning of the "five major supervisions", and explored how to strengthen the "five major supervisions" in combination with the grass-roots supervision practice.
Understanding the Internal Logic of "Five Major Regulations"
The "five major regulations" are an organic whole, which are linked and complementary to each other. Among them, institutional supervision, behavioral supervision and functional supervision are the focus, and penetrating supervision and continuous supervision are the methodology, which can be understood from three levels in general. First, institutional supervision, behavioral supervision and functional supervision constitute the two-dimensional plane of supervision. Institutional supervision is a "dot", the core of which is to manage institutions, an important node in the financial market, to prevent "bad spots"; The key is to standardize the operation behavior of institutions and maintain the trust "link" between financial institutions and financial consumers; The line "gathers" into an area, and the functional supervision is "area", focusing on the unified supervision of similar financial businesses in "blocks" to prevent regulatory arbitrage across markets, industries and regions. The second is to form three-dimensional supervision by longitudinal penetration of the plane. Penetrating the essence of business and the essence of risk is an important guarantee for institutional supervision, behavioral supervision and functional supervision to be deep and solid. The third is to superimpose continuous supervision and realize four-dimensional, space-time supervision. The supervision will run through the whole process of institution establishment, growth and exit, and through the whole cycle of risk germination, evolution, exposure and disposal. Different means will be taken according to different periods to ensure the long-term security and stability of finance by the "spiral" rise of supervision quality and efficiency.
To use a vivid analogy, the financial system can be compared to the transportation system. Financial institutions are all kinds of "transportation vehicles" that carry financial resources and financial well-being. The "five major regulations" are equivalent to "transportation governance". Institutional supervision is to control all kinds of "transportation vehicles" of "sea, land, air and sky network"; Behavior supervision is to combat "traffic violations", curb the illegality and negative externalities of driving behavior, and maintain "traffic order"; Functional supervision is to formulate "traffic rules" for sea transportation, air transportation and land transportation by category; Penetrating supervision is to penetrate "drivers" 'safety awareness, behavior and even humanity, correct ideological deviation, and achieve "civilized" driving; Continuous supervision is to achieve an efficient, smooth and safe "traffic state" through persistent "traffic governance". The highest level is to firmly embed rules into governance and penetrate people's minds, so as to achieve the standardized and orderly "automatic" operation of the entire "traffic system".
Give play to the role of "five major supervisions"
First, institutional supervision. Institutions are the carriers of all financial functions, financial behaviors and financial resources, and institutional supervision is the main axis of the "five major supervisions". China's financial institutions have a complete system, a wide range of types and complex levels. There are significant differences in development orientation and risk characteristics, and supervision is difficult and under pressure. Among them, local legal person institutions are the top priority of financial supervision at the grass-roots level. The core of its supervision is to control the three "culprits" of non-performing assets, non-performing executives and non-performing shareholders, which is the "first step" to prevent local legal person institutions from deteriorating into high-risk institutions. The first is to normalize and promote accountability for debt clearing. Under the unified leadership of the local party committee and government, comprehensively find out the risk base, establish the problem asset account one by one, use administrative, judicial and other forces to coordinate the collection, and simultaneously identify the cause of risk. If violations of laws and disciplines are involved, timely transfer them to the discipline inspection and supervision or public security organs for handling. The second is the selection of systematic management and control executives. We will explore the establishment of a national information database for senior executives, optimize the forms of qualification review and performance evaluation, and highlight substantive supervision. Strengthen the regular consultation with local party committees and governments, and provide them with opinions on the selection of institutional executives from a professional perspective. Explore the establishment of a supply and demand matching platform for financial talents across the province, adhere to the principle of "financiers run finance", and transfer outstanding financial talents from large state-owned banks to local small and medium-sized legal institutions in accordance with the principle of "demand led, market operation". Strengthen the connection between senior management access and subsequent supervision, compare the changes of institutional risk indicators before and after the performance of duties, timely adjust the ineffective performance of duties, initiate accountability for dereliction of duty, and bring corrupt elements to justice. Third, penetrating control of shareholders' equity. Explore the establishment of a nationwide shareholder information database, assist in access review, and isolate problematic shareholders. Dynamically monitor shareholders' operating efficiency, debt level, negative public opinion and other situations, especially penetrate the monitoring of shareholders' large amount financing, investment into shares, equity pledge and other financial behaviors, be highly alert to shareholders with debt surge and "horse racing enclosure" in the financial market, and timely establish a "firewall". Focus on the concerted action taken by shareholders and executives to prevent shareholders and executives from forming a community of interests and eroding the interests of the bank. The shareholders who bear major responsibility for risks shall be dismissed according to law. If they are suspected of committing crimes, they shall be transferred to the public security organ in a timely manner.
Second, conduct supervision. Behavioral supervision is to bring all financial behaviors into supervision. It is not only responsible for "violation of regulations with license", but also for "driving without license", adhere to "long teeth with thorns", maintain the order of financial market, and protect the legitimate rights and interests of financial consumers. The first is to punish licensed institutions for "violation of regulations with license", and ensure that "violations must be corrected". Implement full statement supervision, comprehensively review and evaluate all accounting subjects on the asset side, liability side and equity side, view data through the "full statement", use the articulation relationship to peel off the cocoon and follow the vine, realize the integrated supervision of assets, liabilities and equity, comprehensively review accounting, credit and risk control, excavate the strategy, management and culture behind it, and then analyze its business stability Prudence. Cooperate with financial departments and other departments to crack down on financial fraud and the provision of false certificates by third-party institutions such as accounting firms, so as to punish the "chief villain" and pursue "accomplices". The second is to strictly control illegal organizations' "unlicensed driving" and ensure that "violations will be punished". Strengthen the monitoring and analysis of the financial activities of "two spans and two innovations" (cross departments, cross regions, new formats and new products) in the jurisdiction, constantly strengthen the coordination and linkage with local financial supervision, industry directors, public security and justice departments, and tighten the chain of responsibility in accordance with the principle of "who is in charge who leads, who is in charge who leads, who is close to who leads", and divide forces to guard their respective regulatory areas, We will resolutely eliminate all types of illegal financial activities. The third is to protect the legitimate rights and interests of financial consumers and achieve "people first". Carry out financial knowledge education, strengthen the "three appropriate" management, and do a good job of prevention from the source in advance. We will build a "four in one" dispute resolution mechanism for financial institutions to handle complaints, industry organizations to carry out mediation, regulatory authorities to guide and supervise, and courts to connect litigation and mediation, so as to ensure that consumers' voices are "accessible", appeals are "handled quickly", and disputes are "settled". Focusing on the hot spots and focus problems strongly reflected by the masses in a period, we should dig deep into the reasons behind the problems through special supervision, audit and investigation, and strengthen governance from the root.
Third, functional supervision. Functional supervision is to bring all financial functions and financial innovations into the supervision, adhere to the principle of "one business, one standard", carry out thorough supervision on similar financial businesses across institutions, fields and markets, and prevent regulatory arbitrage and regulatory vacuum. In practice, we can start from the legal relationship, distinguish the nature of business, and achieve unified supervision. The first is entrusted agency business, including wealth management products, trust products, private equity funds and other asset management products, whose essence is "entrusted to manage wealth on behalf of others". The product positioning should be unified to ensure that the product serves investors rather than financiers, and prevent asset management products from turning into "cash machines" for non-performing enterprises; Unify net worth management and resolutely clean up asset management products with rigid cashing nature; Unify information disclosure, narrow information disclosure differences, improve horizontal comparability of products, and save regulatory costs and investor inquiry costs. The second is loan relationship business, including loans, small loans and pawns. For such businesses, the core of functional supervision is to unify standards. On the one hand, unified risk control requirements for lenders (financial institutions). For example, we will unify regulatory indicators such as loan concentration and leverage ratio, and establish risk control systems such as "three checks" on loans, separation of loan review and loan risk classification. On the other hand, the borrower (enterprise or individual) is uniformly restricted in the field of credit extension. For example, they shall not be used for investment in stocks and financial derivatives, and shall not repay loans or interest with loans. Third, leasing business. Including financial leasing and financial leasing, which are essentially the combination of financial goods and financing. At present, the industry is characterized by "one market and two sets of regulatory systems (namely, the Administrative Measures for Financial Leasing Companies and the Interim Measures for the Supervision and Administration of Financial Leasing Companies)". The supervision rules shall be unified and the lease items shall be qualified. Fourth, insurance relationship business. Including property insurance, life insurance, health insurance, accident insurance and other products. The same type of products sold by different types of institutions (such as short-term health insurance products jointly sold by property insurance companies and life insurance companies) should be subject to unified supervision, different sales channels of the same product (such as direct sales of insurance companies and intermediary agencies, online sales and offline sales) should be subject to unified supervision, and different claim settlement standards of the same product should be subject to unified supervision.
Fourth, penetrating supervision. The core of penetrating regulation is anti regulation evasion and anti regulation arbitrage. It is the "through to the end" of the essence of risk, business and behavior. It runs through market access, off-site supervision, on-site inspection and other regulatory links, and ultimately penetrates financial ethics, financial ecology, and financial culture. First, penetrate the flow of funds. No matter how "dazzling" financial innovation can be, it can not be separated from the carrier of capital. We must grasp the essence of capital flow and penetrate it to the end. We must not be blinded by various "tight fitting" illusions. The second is to penetrate accounts. Insist on looking at both "table" and "account", penetrate the accounting subjects, and judge the real risk situation of the institution through asset debt logic, profit and loss balance, and changes in income and expenditure. The third is to penetrate shareholders' equity. Collect, screen and analyze shareholders' information comprehensively, penetrate shareholders' real business conditions, and prohibit disorderly cross industry, high leverage ratio and serious dishonest enterprises from investing in shares. Penetrate the source of capital contribution and strictly prevent circular capital injection, false capital contribution and non self owned capital contribution. Fourth, penetrate corporate governance. Analyze the development strategy, authorization mechanism, accountability system, etc. of the institution, penetrate the normalization of the company's articles of association, penetrate the rationality of KPI assessment system, penetrate the appropriateness of performance pay management distribution, penetrate the effectiveness of internal control, penetrate the sustainability of compliance construction, find out the weakness of corporate governance, and promote risk source governance.
Fifth, continuous supervision. Continuous supervision focuses on the continuous improvement of supervision system, supervision process and supervision system through the construction of supervision responsibility closed-loop, regular review of supervision behavior, timely correction of supervision deviation and other measures, and ultimately the improvement from quantitative change to qualitative change. In practice, we can focus on risk prevention and control, institutional governance, consumer protection and other aspects to optimize and improve the "three mechanisms". First, build a risk early warning and disposal mechanism to achieve full cycle supervision of financial risks. Through all links of risk monitoring, identification, prevention and disposal, we have integrated regulatory indicators such as non-performing loans, provisions, capital and liquidity, internal factors such as corporate governance, case prevention and compliance, external conditions such as shareholders' business conditions, regional economic development, and carried out a "precise picture" of the risks of institutions. On this basis, we will compact our responsibilities, accurately study and judge, and decisively attack to achieve early identification, early warning, early exposure, and early disposal. The second is to build an inspection, correction and governance mechanism to achieve full chain supervision of violations. We will do a good job of verification and characterization, punishment and deterrence, rectification and correction, and get through all aspects of access, inspection, punishment, and governance, so as to achieve the combination of investigation and punishment, breaking and establishment, punishment and education, and management and education, and effectively promote institutions to improve their internal control and governance level and improve the quality of development. The third is to build a coordination management mechanism for consumer insurance and realize the whole process supervision of infringement. Focusing on maintaining order, standardizing behavior, absorbing public opinion, publicity and education, and linking functions such as off-site, access, inspection, punishment, etc., a closed-loop process of asking for people's needs, asking for people's benefits, and asking for people's plans has been formed to comprehensively improve the quality and efficiency of consumer protection work.
Improve the effect of "five major regulations"
First, promote management reengineering. First, strengthen process management. Focus on administrative licensing, off-site supervision, inspection, administrative punishment and other regulatory powers, optimize the operation process and improve the operating procedures. On the one hand, strengthen effective checks and balances, highlight the separation of trial and adjudication, separation of investigation and punishment, and cross review, and put an end to "one clean hand, one person in charge, one package"; On the other hand, strengthen mutual collaboration, focus on "institutions, behaviors, and businesses" to break through barriers, integrate information, form a systematic and holistic regulatory plan, and prevent "each managing one section, ignoring the overall situation". The second is to strengthen the list management. Sort out and improve the responsibility list, task list, target list and standard list of the regulatory departments at all levels, strengthen the sense of responsibility, standard awareness and time limit awareness of all staff, and ensure that all work is rule-based and efficient. The third is to strengthen refined management. The regulatory plan should be profound, the regulatory target should be precise, and the regulatory measures should be precise. Efforts should be made to subtract from the regulatory action, multiply the regulatory effectiveness, and continuously improve the regulatory "output ratio".
Second, strengthen scientific and technological support. First, improve the convenience of supervision. Promote the transformation of regulatory information system from supply oriented to demand oriented, and monitor what the system can collect before; What the system can query, it can check; The system captures what is involved in the analysis; The system generates whatever penetration requires, and constantly improves the level of data convergence and integration across levels, regions, systems, departments, and businesses. The second is to strengthen intelligent supervision. Focusing on the whole life cycle of the institution and the whole chain of risk evolution, we will promote the online operation of all duty performance behaviors such as administrative licensing, off-site supervision, inspection, administrative punishment, consumer protection rights protection, and administrative review, develop remote supervision and mobile supervision equipment, build identification, research and judgment, prediction and early warning modules, and ensure that supervisors know in advance, control in advance, and know and control in the whole process. Third, explore digital supervision. Load the facts, rules, procedures and other elements necessary for the supervision and performance of duties into the digital system to achieve the goal of moving forward from visual display and analysis, multiple accurate portraits, intelligent prompts and reminders to automatic law enforcement decisions with accurate objectives, timely agility and strong penetration, and ensure the objective and unity of standards.
Third, improve the supervision ability. First, stimulate the power of supervision. Explore and improve the "three-dimensional" evaluation system of job matching, historical contribution and public recognition, and focus on accurately identifying and assessing cadres from their work and performance. The second is to cultivate good supervision skills. We will promote targeted training, combat oriented training, and the "three-dimensional" training system of precise empowerment. We will regularly carry out training and learning, job rotation exchanges, and post following exercises. We will orderly promote cadres to the front line of risk regulation to "fight for the bayonet" and to the forefront of reform to "show their skills". Third, build a strong regulatory ladder. Build a "three-dimensional" growth system with experts on the platform, professionals supporting the stage and advanced platforms. Adhere to the concept of establishing a "supervised university", build an internal "faculty pool", and firmly establish the guidance of professional governance, expert governance, and craftsmanship governance.
Fourth, temper the regulatory will. First, emancipate the mind. Focusing on the "five major supervisions", we regularly organize thematic discussions and debates, and special research forums, to free the ideological state of the majority of cadres and workers from inertia thinking and path dependence, eliminate all inert and rigid misunderstanding, and break through the old barriers to work. Second, let the spirit be baptized. We should make good use of the red resources in the area under our jurisdiction, creatively carry out the construction of the organ culture and the regulatory culture, encourage cadres and workers to learn from the spirit of Xibaipo's examination and the spirit of Saihanba's hard work, and practice the political and people oriented nature of financial work in their posts. The third is to improve cognition. We will continue to promote the "self revolution" of regulation, complement the weaknesses of regulation and governance, and create an authoritative image of financial regulation.
Fifth, improve the boosting mechanism. First, strengthen the goal orientation and make good use of the "baton" for assessment. Change the situation of "one size fits all" and "one pot cooking" of assessment indicators, set up typified and differentiated assessment indicators, take fair and objective precautions against slackness, and focus on rectifying the "five poisons" of mediocrity, laziness, laxity, levity, and procrastination with positive and upright motivation. The second is to strengthen the result orientation and make good use of the "tracker" for supervision. Improve the way of supervision, put the awareness, responsibility and style of supervision in a prominent position, promote the performance of duties with awareness in place, promote progress with responsibility implementation, and promote effectiveness with excellent style. The third is to strengthen the problem orientation and make good use of the "tight hoop mantra" of supervision. We should strengthen the cooperation and coordination of discipline inspection, patrol inspection, audit supervision, and financial and accounting supervision, strengthen the control of the whole process of power operation, and strengthen the all-round supervision of all posts, resolutely punish the supervision of dereliction of duty, and effectively promote strong supervision with strong supervision.
(The author of this article introduces: authoritative, professional, rational, cutting-edge, publicizing financial policies, analyzing financial operations, reporting financial practices)
