Research On The Credit Risk Management Of Credit Card For Commercial Banks

In recent years the creqdit card business in China has a significant development, especially in the card number, card issuing banks and transaction amount. However, the risk control of the credit card business is still at an early stage, in the lack of effective mechanisms for risk management control framework. Because credit risk management is the core of credit card risk management, so carrying out research on credit risk management has a great significance for business innovation and the stable development of credit card industry.The thesis introduces the credit card business of commercial banks in terms of process, characteristics and types of risks. Taking a commercial bank of Jiangsu province as example, the current situations and problems of credit card risk management are demostated. Empirical model using neural network is used to assess the credit rating of customers. Finally, several recommendations and measures are proposed to control and mitigate the credit risk of commercial bank's credit card business.This paper is organized as follows:the first chapter, the background, significance and contents of the research have been described. In addition, large amount number of literatures have been reviewed to understand the current situation in the field. In Chapter 2, basic theories are introduced which include the content and features of the credit card business and the concept, classification, characteristics and causes of credit risk followed by the situation and issue of the credit risk management in China. In Chapter 3, the situations and problems of the credit risk management of a commercial branch bank in Jiangsu province are presented. In Chapter 4, the existing credit scoring models are introduced and compared, then it is concluded that the neural networks model is suitable for Chinese commercial banks. Empirical analysis is carried out based on customer data which assesses the credit authorization level according to information of applicants. Chapter 5 proposes suggestions to improve the credit risk managements of credit cards in China.