Study On Risk Prevention Of Individual Housing Loans Of China's Commercial Banks

With the socialist market economic system setting up and completing perfectly, marketization and monetization levels of China's real estate are increasing. Greatly develop individual housing loans has become a catalyst for healthy development of real estate market, but also an important means to improve housing conditions and level. In recent years, various commercial banks has strengthened support for individual housing loans, proportion of individual housing loans accounted for bank assets has been increasing year by year. As of the end of 2008, balance of individual housing loans reached 2.95 trillion, accounting for 10% of total RMB balance of commercial banks. At the same time, with the rapid development of individual housing loans, its credit risk is increasingly demonstrated. The outbreak of the sub-prime loan crisis in United States is especially a warning which can not be ignored for development of China's real estate market. Therefore, it is of great theoretical and practical significance for currently studying and exploring risk prevention and control issue on individual housing loans of our country commercial banks to ensure sound operation of credit assets of commercial bank, and thereby promote sustainable and healthy development of real estate as well as national economy.This paper provides an overview of the risk and prevention theory and related literature of individual housing loans. On the basic of which, it defines the meaning and feature of related concept on individual housing loans, analyzes the status quo on individual housing loan business in China as well as the financial risks faced in operating commercial banks, and thereby examines the specific cause for the risk generation of individual housing loans. Then, taking the serious impact of the breakout of sub-loan crisis in United States on finance and economic as a warning, combined with the reality of our country, it proposes idea and response on effectively preventing the risk of individual housing loans of our commercial banks:establish a sound control mechanisms on banking credit risk at internal controlling risk of individual housing loans; improve bad debts preparation system on individual housing loans; innovative financial products to shift credit risk effectively; perfect the legal system of individual housing loans at external preventing risk of individual housing loans; strengthen financial supervision and management of individual housing loans; complete a well-established personal credit information system; perfect guarantee mechanism for individual housing loans; set up a sound insurance system for individual housing loans; healthily develop real estate; speed up the implementation of social housing security system.