Guidelines for the Compliance Risk Management of Commercial Banks (1)
Source: CBRC View: 427 Date: 2011-05-16

Chapter I General Provisions

Article 1 For the purpose of strengthening the compliance risk management of commercial banks and maintaining commercial banks operating safely and stably, these Guidelines are instituted in accordance with the Measures of the People’s Republic of China on the Supervision and Administration of the Banking Sector and the Law of the People’s Republic of China on Commercial Banks.

Article 2 A Chinese-funded commercial bank, foreign sole-capital bank, joint venture bank or branch of a foreign bank established within the territory of the People’s Republic of China shall be governed by these Guidelines.

A policy bank, financial asset management company, urban credit cooperative, rural credit cooperative, trust investment company, enterprise group financial company, financial lease company, automobile financial company, currency brokerage company, postal savings institution or any other financial institution established within the territory of the People’s Republic of China and approved by the China Banking Regulatory Commission shall be governed by these Guidelines.

Article 3 The term "laws, rules and standards" as mentioned in these Guidelines refers to the laws, administrative regulations, departmental rules as well as other regulatory documents, business rules and industrial standards of self-disciplinary organizations, behavioral code and occupation ethnics.

The term "compliance" as mentioned in these Guidelines refers to the consistence between the business operations of commercial banks and the related laws, rules and standards.

The term "compliance risks" as mentioned in these Guidelines refers to the risks of a commercial bank suffering from legal sanction, supervision punishment, great financial losses or reputation losses when it violates any law, rule or standard.

The term "compliance management department" as mentioned in these Guidelines refers to any department, team or position that especially established within a commercial bank to take charge of compliance management.

Article 4 Compliance management is a core risk management of commercial banks. A commercial bank shall take overall consideration of the relevance between compliance risks and credit risks, market risks, operation risks and other risks so as to ensure the consistence between all the policies and formalities for risk management.

Article 5 The objective of compliance risk management of a commercial bank is to establish and improve a framework of compliance risk management so as to realize the effective recognition and management of compliance risks, promote the establishment of an overall system of risk management and ensure an operation based on compliance of laws and regulations.

Article 6 A commercial bank shall enhance the establishment of compliance culture and incorporate the establishment of compliance culture into the whole process of establishing its enterprise culture.

The compliance is the joint responsibility of all staff members of a commercial bank and its senior management shall take a lead in the execution thereof.

The board of directors and senior management of a commercial bank shall determine the keynote of compliance, set up such compliance philosophies as voluntary compliance by all its staff members and value creation subject to compliance, promote the occupational ethnics and value concept of being creditworthy and upright within the bank, elevate the compliance consciousness of all its staff members and promote an effective interaction between self-compliance of the commercial bank and external supervision.

Article 7 China Banking Regulatory Commission shall implement supervision over the compliance risk management of commercial banks, examine and evaluate the effectiveness of compliance risk management of commercial banks.
 

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