A Primary Research On Risk Management Of Factoring In The Commercial Bank Of China

In recent years, domestic factoring developed rapidly and has become one of the important business species that commercial bank is racing to promote. With regard to our country's economic development for the time being, to develop factoring business will contribute to our country's adjustment of large scale industrial structure, enhancing the credit consciousness of the enterprises, improving the commercial bank's macro management environment, promoting the small and medium-sized enterprise development and accelerating the progress of the financial service innovation of the small and medium-sized enterprise. If the risk of the domestic factoring is not recognized and prevented correctly, the commercial bank'assets may be suffered great losses.Firstly this article systematically explains the beginning and the development of the factoring in domestic and overseas regions, and retrospects the application of the accounts receivable management theory and the financial risk management theory in the domestic factoring. And following, the article particularly discusses the features and functions of the domestic factoring, compares the hidden factoring with the public factoring and factoring financing with accounts receivable financing, and revealed that the advantage of factoring in the cooperation's financing. Furthermore, the article discussed the risk facing with the development of the domestic factoring in detail, and analyzed the legal risk, operation risk and credit risk partly, explained the presentation forms and the harm of the risk and come up with the solution and prevention for the risk. Especially aiming at the credit risk, the article proposed a solution using the internal rating model (IRB) and rating combination model to judge the credit risk of the factoring financing. Following the writer explained the problem based on an example of the risk prevention practice in the factoring financing during the opening process of the domestic factoring in the China Construction bank of Hebei branch, and also chose two specific cases for the explanation. Finally, the article described the innovation development of the domestic factoring briefly. The main contribution of this paper is to give systematic, targeted and operational risk management solutions of the factoring finance. By choosing accounts receivable, opening account payment, this article gives a method to control the legal risk of the factoring finance through the choice of the accounts receivable, special account of debt collection and using the accounts receivable pledge / transfer registration of the People's Bank Credit Information Center. As well as the article proposed three measures to strengthen the management of the operational risk: starting from the survey before loan, review in the loans and examination after the loans, to enforce throughout management and realize form change management and refined management; building high qualified team, using the centralizing processing to take place of the scatter operation methods; to reduce manual operation through information tools. The article presents the methods of evaluating the credit rating grade of the buyer and the seller using the inter rating based approaches(IRB). And the article gives the method to prevent credit risk form the origin through giving the model of the credit rating system of the both sides of the enterprise, which acting as the customer qualification of the factoring finance.