The Thinking And Utilizing On The Credit Intensive Management In The Agricultural Bank Of Jilin Province

With the accomplishment of joint-stock reform in the state-owned commercial banks and the full liberalization of the financial markets, the financial competitiveness has reached a higher and further level. Because of the obvious same business among the financial enterprises, the quality and efficiency of the commercial banks'management have to depend on their intensive management. The main assets of commercial banks are composed of their credit assets which will produce the profits, therefore, only in the way of intensive management of the loan and credit, can we control the credit risk and guarantee the profits. In the past, the Agricultural Bank of Jilin Province had lost enormous credit assets just because it adopted an extensive type of management and gave more priority to the lending business than management. Now, accomplishing the joint stock reform, the Agricultural Bank of Jilin Province has stripped most of its nonperforming assets and engaged in strategic transformation for management. Under the complicated and changeable economic and financial circumstances from both home and abroad, how to maintain what we've got, i.e., the network of our service centers, scale, national honor etc. before they are missing, how to improve our management, i.e., from extensive management to intensive management and how to be invincible in the serious competition among the banking industries, those are what we urgently need to resolve.The intensive management of credit is based on the premise that the credit risk must be controlled and the maximum profits must be gained. That is to say we must deal with our credit asset meticulously, scientifically and systematically by the way of carefully assigning our target markets and clients, reforming our organizations and optimizing our businesses.First ,the author of this thesis analyses the present statement of the credit management in the Agricultural Bank of Jilin Province and points out the necessity for intensive management through deep analyzing the problem in the credit management at present. In the past, because of the wrong strategic orientation, the Bank gave up the business fields in the country which used to be its main area, and marched in the towns. In order to make credit assets bigger, there were no strategic ane emphasis on the client selection, so as the clients were small and middle enterprises. As a result, it got confused and did not know who would be its clients and could not set up a stable group of clients. Since 1979,the Agricultural Bank of Jilin Province has twice stripped the nonperforming assets, which reached 39.4 billion yuan because of its poor credit risk awareness, the low decision-making levels, the inefficiency of credit business, the poor implementation of its disciplines and regulations, and its multiple management levels. Therefore, the Bank's assets shrank sharply at the beginning of the joint-stock reform and its credit scale fell down to 20 billion yuan which is not enough to deal with the complicated and changeable situation in both the domestic and foreign financial markets. We realize that the extensive type of management does not adapt to the new situation and market competition, if we want to survive and win in the serious market competition , we have to seek the efficiency from the management . Only by putting the intensive management into effect, and setting up a comprehensive risk management system for a long term project, the operation of the Agriculture Bank , JiLin Province can succeed finally.Second, the author, in this thesis, put up a path design for the problem of the extensive type of management in Jilin Agricultural Bank. Analyzing the present economic tendency , banking competition and the"3 problems in China's agriculture, the author put forward a"3510"managing plan and a credit strategy which possesses a dumbbell shape. While implementing the strategic objectives, we must, on one hand, teach our staffs the philosophy of cautious, regular and reliable management, and create a circumstance for the intensive management. On the other hand, we need to reform our management organization so as to set up a new professional one with high efficiency, streamlined offices and swift reaction to the changeable markets. In the path to the management division reform, we should adopt different models for the company business and private service, that is to say, company business should be managed by a high level division and private service by low level divisions. In the top-down model, the company business should be dealt with by the city branch, the province branch, even to the national head office , make up a 3-level clients group . As to the private service, we need to adopt the down-top model , set up sales network in the city districts and communities, and put all the private services into intensive and standardization management. Then we will set up a goal of mixing matrix-type organizational model , clarify the duties in different levels to form an ideal organization in which we have got three business lines business ,---the front business lines will deal with the company, private, and"3 agriculture problems", the middle lines will support direct and professional management, and the back-end business lines will be a centralized modular organization, so that we can improve the construction of the backing system and optimize the business process, fundamentally improving our service, realizing the growing type from the extensive to the intensive.At the end of this thesis, the author designs a path to reach the goal. Before lending we should make the appropriate checks to different customers who will be divided into high-end customers, mid-market customers and low-end customers, and carry out"C---A---P"strategy, supply some packages for varied financial services to different areas and customers. Through market and customer segments , we make different management to the business clients , foster 3-level core clients group . And in order to realize the professional management for the small business and personal loan we should distinguish different clients and adopt the policy that the scattered business will be received individually and its management should be centralized. On the lending process, we should develop policies scientifically ,carry out clients-list management and forcefully put them into practice so that we can know where our clients are, what credit regulation we should observe, what credit lines we should control and what authorization we should base on. We need to accelerate the construction of internal rating system, timely introduce other credit management tools, enhance the application of electronic means, improve the capability of risk prevention and control, as well as optimize the process of credit examination and approval and improve the efficiency of credit review. After lending, we will set up special post-loan management posts with its clear duties and construct strict bank supervision institution step by step , meanwhile, we will put the intensive management into loan contracts, mortgage collateral, and risk warning etc. It is loan officers that implement the intensive management and put it in place. Therefore, it is crucial to establish an effective incentive mechanism and to train some senior management teams with practice and advanced management tools as the middle strength of credit management.Through above analysis, we can find out that the credit intensive management is the most economical and optimized way to reach our business goals. After the joint-stock reform, Jilin Agricultural Bank has to give up the previous extensive type of management, and to explore and follow the way of credit intensive management so as to make our business more excellent, delicate, rigorous and solid. Only by credit intensive management, can the Bank improve its core competency among the banking industries and guarantee its credit asset into the maximum.