China's Commercial Banking Group, Customer Credit Risk Research

The modern market economy with the characteristic of risk is mainly made up of currency and credit resources. The financial system is the core of the economy. The commercial banks' importance therefore brings the risk in the economy, and then reflects on the most important risk in the whole financial system – Credit Risk. In recent years, the corporate clients are highly developed. They are not only the sign of the local industrialization and core competence, but also the main target customers for the banks. However, while bringing the banks great profits, there also exists credit risk. Yin Guang Xia, Lan Tian and some other scandals from the corporate have involved so many creditor banks and a huge amount of capital. The whole financial world in China was shocked. This phenomenon is due to the lack of management on giving credits to corporate clients, modified management system. Banks always take the size of the companies as a criterion for the risk judgment, prefer to give credits to corporate, which causes the centralization of the credits and wrong segmentation of the credit market. They don't take into consideration of the complicated stock holding information and the existence of the internal trade. The shortage of transparent information in turn causes the credit risk for the banks. Therefore, this thesis focuses on the research of corporate clients' credit risk of the commercial banks. The thesis defined the commercial banks' corporate clients in characteristics as well as in actual numbers, which is the logic starter for the discussion of the credit risk. In the process of research, author uses the common theory for commercial banks' credit risk, takes in the corporate clients as actual examples for the statement, analyzes the current situation, characteristic, harm, reason and China's soft environment for the problem and finally gives suggested measures that could be taken for the problem. Advanced foreign experience is also taken as reference for deeper analysis. This thesis is composed of four parts: Part One: Theoretical analysis for credit risk. First, the concept of credit risk. Starting from the concept of risk, the concept of credit risk is also introduced, as well as the analysis of the difference of credit risk from other risks and the categorization of credit risk according to difference matters that cause the loss of credit assets. Second, the analysis of the influence that credit risk brings to economy. The reason that credit risk is the most important risk that existed in the financial system is because of the leading position the commercial banks occupy in a country's financial system. On the basis of analyzing the importance of credit risk, from macro and micro points of view, the author discussed the negative influence that credit risk brings to economy. Third, the analysis for the cause of credit risk. The imbalance of information, incomplete credit contract and the operation system with high credits of the commercial banks, are common reasons for credit risk. On the other hand, the commercial banks' system and operating model also caused the risk. Hence the special characteristics of the government, the enterprises and the banks are also taken into consideration. Fourth, the introduction of the management on credit risk of the commercial banks in western countries. This part provided a theoretical framework for the later chapters' research. Part Two: The analysis of the current situation of the corporate clients' credit risk in China. The current rules and regulations cannot realize the mutual guarantee in reality. There is not any unified standard and it is not helpful for practical operation. This thesis combined practice together with "Corporate Accounting Rules" and "Taxation Management on Relative Corporations' Business Communication", defined the range forcorporate clients. Then in this range, the author divided corporate clients into two types, and analyzed the current situation of their credit risks. On this basis, the characteristics of corporate clients' c...