With the high integration of Internet technology and finance, financial technology, a network model that attaches importance to assets and services, has gradually penetrated into financial models and business types, and has gradually produced catfish effect and demonstration effect on traditional financial business, which has promoted the reform of financial institutions. However, the asymmetric information, low transparency in the transaction process and the inability to guarantee information security in the network virtual environment make traditional financial institutions prone to micro risks such as moral risk, technical risk, credit risk, legal risk, operational risk, market risk and liquidity risk, while the original macro risks such as reputation risk and systemic risk,

Financial technology is the product of the combination of Internet technology and traditional finance. Financial institutions face many problems in developing financial technology and cooperating with Internet companies. Summarize the causes of financial technology risks of financial institutions, mainly including the following aspects: First, financial technology policies are vague, laws are lacking, and supervision is lagging behind, which easily leads to legal risks and market risks; Such as e-rental, Dada group and other risks are frequent; Secondly, the information asymmetry, opaque transaction and uncertain identity in the virtual environment of the Internet easily lead to moral hazard; Third, financial technology depends on information systems, which can be tampered with and attacked, easily leading to technical risks; Fourth, the intersection, comprehensiveness and substitution of financial technology and traditional financial business are easy to cause systemic risks.

Risk classification and risk identification of financial technology in financial institutions

Financial technology is still finance in essence, and its activities have not deviated from the scope of financing, credit creation and risk management, nor have they violated the objective law of matching risks and returns, nor have they changed the characteristics of financial risks such as concealment, suddenness, contagion and negative externalities. Moreover, the multi-dimensional openness and multi-directional interaction of modern cyberspace make the spread, diffusion speed and spillover effect of financial technology risks far beyond traditional finance. The main risk categories of financial institutions to carry out financial technology business are as follows.

(1) Financial institutions deploy financial technology P2P services, which may easily lead to credit risk. On the one hand, traditional financial institutions have laid out financial technology services one after another, which is easy to cause credit risk because of the imperfect credit environment and incomplete credit input data in China; On the other hand, traditional financial institutions provide fund custody services for P2P platforms, and do project audit and fund management based on the platform itself. Once there is a credit problem in the platform, it is difficult to protect the legitimate rights and interests of investors, which will easily lead to the accountability of traditional financial institutions for fund custody and lead to the outbreak of credit risk.

(2) It is the cooperation between financial institutions and third-party payment, crowdfunding and internet financing, which is likely to lead to legal risks. Traditional financial institutions use third-party payment channels to invest in online money market funds, and gradually expand to regular wealth management, insurance wealth management, index funds and so on. The payment institution will use the fund depository account to form a fund pool, which will lead to a sharp increase in the amount of reserve funds. The illegal operation of the payment institution to misappropriate reserve funds will make it difficult for customers to pay, which will lead to legal risks; Illegal fund-raising, fund-raising fraud, money laundering and other illegal issues caused by cooperation with illegal business enterprises are likely to lead to legal risks.

(3) The financial technology integrated operation platform is built by financial institutions, which may easily lead to operational risks. Traditional financial institutions have laid out comprehensive financial technology service platforms one after another, and implanted financial services such as financial investment, financing services, securities trading and fund purchase into online platforms. By opening up business boundaries such as banking, politics and insurance, they have improved their comprehensive operation level and enhanced customer stickiness. The convenience of the financial technology platform urges the platform to update information and facilitate the operation of users. But on the one hand, due to the lack of adequate investor education, it is easy for investors to operate improperly; On the other hand, due to cross-business operation, it is easy to cause improper internal control and operation process design, resulting in capital loss or disclosure of investor identity information, which in turn leads to operational risks.

(4) It is the cooperation between financial institutions and P2P, Internet financing and Internet banking that easily leads to liquidity risk. On the one hand, P2P and Internet financial management violate the rules and promise investors to protect capital and interest, centralized payment and so on. It is easy to lead to liquidity risk. On the other hand, third-party payment accounts are active and engaged in the field of financial technology, so there is a risk factor of mismatch of fund maturity. Once the money market fluctuates greatly, there will be a large-scale capital run, which will lead to liquidity risk.

(5) It is the development and popularization of mobile communication technology that easily leads to information technology risks. The security of mobile communication technology largely depends on the IT technology, risk identification technology and anti-hacker and virus attack technology of network platform. In recent years, pseudo base stations, forged banking service information, information "dragging the library" and "colliding with the library" have occurred frequently. If the preventive measures are improper, it is easy to appear information technology risks.

(6) Financial institutions are involved in the baby money fund business, and there is regulatory arbitrage risk. On the one hand, it leads to cross-border product functions. On the other hand, it may arbitrage from different regulatory standards. For example, when investing in Internet "baby" products, the deposit funds agreed by banks are not general deposits and do not need to pay deposit reserve, which is considered by some people as regulatory arbitrage.

Financial institutions' financial technology risk response mechanism

At present, the regulatory authorities have begun to formulate cross-border Internet financing and cross-border financial business norms for the financial technology industry, and the traditional financial risk coping mechanism can no longer adapt to the financial innovation of the Internet. On the one hand, Internet business can prevent risks by establishing negative list, behavior supervision and investor suitability principle. On the other hand, it is imperative to strengthen the classified protection of assets, funds and investors and strengthen the ability of risk control. In addition, according to the Guidelines on Consolidated Management and Supervision of Commercial Banks, whether it is the coordination of cross-product and cooperative business between subsidiaries of bank groups, subsidiaries and other financial institutions, or the corporate governance, capital and finance of their subsidiaries, comprehensive and continuous consolidated control must be carried out under the existing system. Therefore, when traditional financial institutions deploy financial technology or cooperate with related enterprises, in order to prevent cross-industry risk contagion, they need to integrate the risk categories of financial technology into the current risk management system and build an integrated comprehensive risk management system to effectively identify, measure, monitor and control the overall risk situation after consolidation.

(1) reasonably control the internal control risks of financial technology. First, establish a sound internal control mechanism for financial institutions to prevent financial technology risks, improve the internal control, management and external risk resistance capabilities of financial institutions, and effectively prevent operational risks; Secondly, strengthen the risk prevention awareness of financial institutions in compliance with the law, enhance the moral education and behavior control of employees, improve the professional quality of employees, and effectively prevent moral risks; Third, strengthen the monitoring of accounts and capital flows, strictly identify, review transactions and reconcile large amounts; The fourth is to establish differentiated business strategies for risk taking and risk transfer of subsidiaries of financial institutions, so as to effectively prevent and resolve reputation risks. Finally, establish risk early warning and emergency measures to warn, deal with and report illegal activities such as illegal fund-raising, fund-raising fraud and money laundering. Once found, take recovery measures, quickly start judicial protection procedures, and effectively prevent legal risks.

(2) Strengthen financial technology information technology risk prevention. First, improve the core technology level of financial science and technology, run security prevention systems, such as maintaining operating system security, firewall technology, virtual private network technology, intrusion detection technology, financial information and data security prevention technology, and prevent technical risks such as system failure, hacker attack and virus implantation; Secondly, self-built credit collection and application system, cooperation with regulatory agencies to achieve information sharing, the use of information technology to achieve on-site and off-site inspection, through Internet technology to effectively prevent illegal fund-raising, fund-raising fraud, money laundering and other criminal activities, effectively prevent systemic risks; Finally, using advanced technologies such as big data mining and blockchain, a credit evaluation system and a risk early warning model are established to effectively prevent legal risks caused by information leakage.

(3) Build a quantitative monitoring index system for financial technology risks. First of all, use quantitative indicators to analyze the operation of financial technology and strengthen the risk management and macro-decision-making of financial technology. Financial institutions can set up another financial technology section on the asset quality side to provide liquidity risk of financial technology products on a regular basis? Risk monitoring of quantitative indicators such as credit risk and operational risk capital. Secondly, indicators can be selected based on the current risk control indicator model, for example, cross-bank? Liquidity coverage ratio (LCR) and Net Stable Capital Ratio (NSFR) are used to prevent liquidity risk, combined five-level classified monitoring is used to prevent credit risk, or capital allocation is used to prevent operational risk. Finally, the basic framework of risk data collection is constructed from the perspective of comprehensive statistics, and the index system is constructed by collecting the relevant information of financial technology sub-platform, forming a monitoring framework integrated with the current risk management system as a supplement to the traditional financial risk management system.

(d) To avoid the risk contagion of financial technology, firstly, financial technology should draw a portrait of a single user under the increasingly complicated mutual migration and intersection of a large number of customers? Which group does an individual transaction object or affiliated enterprise belong to? Specific commodity risk position? Limits of risk concentration types such as specific information service providers to resist the risk of cross-infection caused by excessive concentration of transactions. Secondly, the information system of the same person, the same related person or the same related enterprise can be established for different online lending sub-platforms to which financial institutions belong, and the dynamic risk adjustment mechanism of the loan quota threshold between platforms can be used to effectively prevent the risk of default or malicious fraud that may be caused by cross-platform lending. Finally, establish a notification mechanism for major credit emergencies in the field of financial technology to prevent the risk of cross-infection when the crisis occurs as soon as possible.