The RAROC Technology and Its Adjustment in I-Bank Capital Allocation Base on the ERM

As the network economy and e-buy is developing, the I-bank is becoming more and more important in our social; it is the most influential financial innovation, which has its own special characters; its development is pressing needing the system and comprehensive risk management. To resist the risk of I-bank, effectively capital allocation can help. The mixed operation trend and network economy environment it face, require the allocation of I-bank must use the approach of integrated risk management which can take the relationship of risk and capital cost into account roundly in a comprehensive and scientific risk management framework with norms process. The paper right start from this point, and adjusted the input-output relationship, the expected risk loss, and economy capital in the RAROC technology combined the characters of I-bank. At the end, the paper raises a support system of using the RAROC technique.