Research On Customer Credit Risk Early-warning System Of Commercial Banks

Intensified U.S. loan crisis has a great impact on the financial world. With the three major Wall Street investment banks close down one after another, several well-known insurance companies also encounter problems, as the nation's largest commercial banks, Washington Mutual closes down too, and Citigroup and other major commercial banks also bog down. At this point, in order to persue sustained and rapidly growing profit ,commercial banks are prone to excessive competition, relaxing credit standards and expanding the credit customers blindly. So in the credit process commercial banks should strictly enforce the standards of credit, pay close attention to the financial and non-financial situation of the customers, to prevent the accumulation of credit risk. In this context, it is necessary to research customer credit risk early-warning system of commercial banks in-depth ,in order to keep close eyes on customer credit risk , make right decisions during credit management process, and enhance the risk management capability of commercial banks .The thesis discusses credit risk from microcosmic perspective, commercial banks'corporate customers , to provide credit support for decision-making. First of all, it reviewes the research process of the commercial banks' credit risk early-warning. Secondly, it analyzes credit risk characteristics of commercial banks and related factors, it analyzes the characteristics and the related theories of credit risk early-warning of commercial banks. Thirdly, it constructs a customer credit risk early-warning system which meets current development need of commercial banks, explaines the selection of early-warning indicators in detail, determines the weight of early-warning indicators, constructs a comprehensive system of early-warning indicators and early-warning model. Finally, it analyzes the comprehensive use of costomer credit risk early-warning indicator system and model of commercial banks in detail, in case of a real estate company, a typical customer of China Construction Bank Corp. It discusses from three aspects, the early-warning indicator, the early-warning model and evaluation .In some extent, it demonstrates the feasibility and practicality of the designed system of early-warning indicators and early-warning model . For the study method, the Delphi method is used in choosing credit risk early-warning indicators of commercial banks. It uses the Delphi method and Analytic Hierarchy Process to determine the weight of indicators, and uses the efficacy coefficient method to deal with the evaluation value of indicators in order to obtain a comprehensive costomer credit risk early-warning index system of commercial banks.The thesis proposes credit risk early-warning from the microcosmic point of view, that is the customer enterprise. According to the need of credit process of commercial banks, it establishes a corresponding credit risk early-warning system. Secondly, it emphasises on cash flow when it chooses qualitative indicators , overcoming the past indicators'disadvantage which although it combines quantitative and qualitative indicators, but too few quantitative indicators and too many qualitative indicators. Thirdly, it uses Gray Early-warning method to predict the credit risk of commercial banks dynamicly.