<p class="ql-block"><br></p><p class="ql-block"> Bank Risk Control and Compliance</p><p class="ql-block"> "Do you trust banks to take care of your money?"</p><p class="ql-block">People often worry about the safety of their own deposits at the banks due to banks' high liabilities and risks. The situation is positive; Chinese banks are under the strictest risk control and compliance.</p><p class="ql-block"> </p><p class="ql-block">1. Financial License and Qualification ( 金融牌照與從業(yè)資格）</p><p class="ql-block">The State Financial Regulatory Administration approves the establishment of banks and issues licenses.For key positions such as branch managers, staff must pass qualification reviews conducted by the regulatory authority, including work experience, moral character, education, and banking background. 2 ，Capital Adequacy Ratio（資本充足率）</p><p class="ql-block"> In accordance with the Basel Accord and the actual situation in China ,banks must maintain core capital of at least 15% of total assets. Since most assets come from customer deposits, banks face high risks.</p><p class="ql-block">3. Required Reserves（法定存款準(zhǔn)備金）</p><p class="ql-block">To control fund flows and exchange risks, banks must keep 5% of deposits as reserves at the central bank. The central bank adjusts this ratio to manage social liquidity.</p><p class="ql-block">4. Deposit Insurance（存款保險(xiǎn)）</p><p class="ql-block">Banks must participate in deposit insurance. If a bank goes bankrupt, depositors receive at least basic compensation.</p><p class="ql-block">5. Loan?to?Deposit Ratio（存貸比）</p><p class="ql-block">The loan?to?deposit ratio is calculated as total loans divided by total deposits (including required reserves). The loan balance cannot exceed 75% of total deposits, ensuring stable liquidity.</p><p class="ql-block">6. Loan Loss Provisions（貸款損失撥備，壞帳準(zhǔn)備金）</p><p class="ql-block">Banks must use pre?tax profits to set aside provisions for potential bad loans. This absorbs risks, links loan quality to business performance, and protects shareholders’ equity.</p><p class="ql-block"> </p><p class="ql-block">Regulators strengthen supervision and investigate illegal activities seriously. Penalties depend on the severity of violations.</p><p class="ql-block"> </p><p class="ql-block">Serious violations may lead to license revocation and qualification cancellation. Criminal cases will be transferred to judicial authorities.</p><p class="ql-block"> </p><p class="ql-block"> </p><p class="ql-block"> </p><p class="ql-block"><br></p>