Individual Consumption Loan Credit Rating Study

Consumer credit is a credit conduct and system that for the need of living, financial or commercial organizations provide consumers of the capacity to pay with some consumer credit in the forms of goods, money and other forms, and the consumers pay back a certain period in the future. Consumer Credit in China started in the mid 1980s of the 20th century, but its rapid development began in the late 1990s of the 20th century. By the end of 1997, national personal consumption is only 17.2 billion credit scale, and to the end of 2008,consumer credit had increased to 37 000 billion, an increase of 217 times over 1997;personal consumer loans accounted for RMB loans ratio 0.2% in 1997 rose to 12.28% in 2008.The scale of consumer credit increased year by year, resulting in the needs of the individual credit risk management. However, because of China has long been emphases on the enterprise credit system construction, the lack of specialized agencies to the credit history data collection and a series of other factors, there are many problems in the China's commercial bank credit risk management, that are serious information asymmetry during the loans are provide and the lack of scientific methods of individuals credit evaluation and other issues, which is incompatible with the rapid growth of consumer credit. Overseas experience shows that personal credit score model as an effective management tool for individual credit risk assessment, has played a very important role in consumer credit risk management of the commercial banks.Under the current conditions of the imperfect personal credit data, imperfect credit technology and the lack of professional staff it has a very practical sense that making full use of existing data and information of information systems in commercial banks and establishing a personal credit risk assessment model which has certain predictability and some reference value in the credit decision-making in line with our national conditions.In this paper, with the sample of 1356 personal consumer loans document information approved by H Rural Commercial Bank from March 26,2008 to October 13,2009,the author has tried to build personal credit risk assessment model by the statistical methods of survival analysis, Logistic regression and discriminant analysis and find out the main factors affecting consumer credit risk through the model variables comparison in order to put forward practical recommendations about making the appropriate credit decision criteria. This article is divided into five parts.Firstly, it has the brief statement on the research background and significance. In view of the emphases on building individual credit risk assessment model through survival analysis, Logistic regression and discriminant analysis, the first part of the paper has the focus on the currently popular method of credit scoring modeling, the advantages and disadvantages as well as the application in our credit evaluation for considering the score model establishment of the next stage. Then, this paper has defined the basic concepts, content and location of consumer credit, credit risk, credit scoring and other concepts.In the PartⅢthis paper has the research and analysis in detail about the methods of the survival function of a single variable, Cox regression, Logistic regression and discriminant analysis and the modeling which are used in the article in the test. Finally, by the empirical analysis of H Rural Commercial Bank, the paper has showed that the three variables of education, loans modes and the age is important to the customer type recognition in the existing credit systems of H Rural Commercial Bank and proposed the solution.