On Enterprises Credit Evaluation Of Commercial Banks In China

Credit risk is the primary risk that the commercial banks in China face with, and it is fundamental to supply a scientific credit evaluation method for the loan enterprises to avoid the regeneration of non-performing assets of commercial banks. So credit evaluation is related to the banks' moderate management.According to analysis and study on credit evaluation methods and techniques domestic and abroad and the practical circumstances of commercial banks in China, this paper indicates the deficiency of the method of classifying credit in Chinese commercial banks at present: the simpleness of the quantitative method, the inevitability of subjectivity, etc. Aiming at resolving these problems, this paper constructs a credit evaluation model, hoping to gives reference for the commercial banks' scientific decision-making of credit loans.Based on the current index system of credit rating, we use Principal Component Analysis to filtrate the index quantitatively, overcoming the subjectivity of index selection. In this paper, we develop a DEA model based on accepted cases set and propose a classification method with piece wise linear separating hyperplane as its boundary. The method proposed can assess the credit of new enterprises when we only know the credit information of healthy enterprises. Finally, we make a empirical study for credit evaluation by 180 enterprises' sectional data of loans in 2002.Empirical results show that the model and method proposed are feasible.