A Study On The Risks And Precautions Of International Factoring In Commercial Banks

With the international economic globalization, export competition is more and more intensive, as an effective way of international settlement and trade financing product, international factoring has been rapidly developed and widely used. The international factoring can help the exporter to reduce the credit risk, expand the sales and explore the global market. As an new product, the interests and fees of the international factoring are the significant parts of the profits of the banks. Nowadays, the risks of export companies are increasing, which diminishes the profit margin of the commercial banks. Risks control becomes an urgent problem of the commercial banks.For this, the paper began with the introduction of fundamental aspects such as development process, character of international factoring, and the relevant economic theories, and then launched the discussion. The first chapter of this paper is an introduction of the background of the topic, the aim of the study, research status at home and abroad and literature review and the methodology of study. The second chapter talks about the origin and development of international factoring as well as the problems existed. The third chapter introduces the product of international factoring in Ningbo Z bank, and raise problems in Z bank. Those problems are analyzed and discussed in chapter four. The fifth chapter solves the problems and proposes solutions from prospects of risk warning and mechanic construction. In conclusion, international factoring risk can be identified and prevented, as long as the full understanding and effective risk control, international factoring can grow healthy and rapidly.