Kmv Model Measure Of Bank Credit Risk Analysis

The theories and technologies of risk measuring, forecasting and avoidingalways appear extremely important in the field of Finance. Because theFinance industries supply services, assume risks and then earn returns tomaintain the survival and development. While in the other hand, they arealways confronted with the risk of bankrupts.The crediting services are the most basic businesses of commercial banks,the fundamental requirement is the combination of benefit, security andliquidity. So controlling, avoiding and decreasing risks and assuringsecurity of crediting funds is not only required by the banks survival anddevelopment, but also is the primary role of crediting management. Butthe application studies about crediting risk measuring of commercialbanks are not familiar in our country. And most of them are discussions inone direction of business affairs, and always are based in naturedetermining, and are lack of quantifying. This article discussed the topicabout how to use the KMV model, which is matured in western countries,to measuring and quantifying the crediting risks of commercial banks.And I hope it can be benefit in the field of commercial banks creditingrisks management.