Study On The Evaluating Method Of Credit Access For Steel Clients For National Commercial Banks

The steel industry is not only related to the development of the economy but alsocritical in the economy security. The rapid growth of national economy in recentyears brings a wave in steel manufacturing as well as the great-leap-forwarddevelopment of the industry. The steel industry is a capital-intensive industry sincethe construction and the manufacturing processes require a large quantity of funds,therefore the enterprises become the important and profitable clients of thecommercial banks. To maximize the usage of the limited banking resources, it isimportant for the banks to establish a scientific selecting method of the steel clientsthrough systematic evaluations and analysis.The paper studies the evaluating method of selecting the steel clients for the bankswith both domestic and foreign theories in related fields as its foundation. It startswith a research on the features of the development of the steel industry, and itsspecific funding requirement as well. And then studies the national macro controlpolicies over the steel industry and the impact of these policies on the credit policiesof the banks toward the steel clients. The paper analyses the character of the runningand management of the industry, and reaches several key factors in evaluating theclients in the industry as well. The paper describes the present credit access policiesand analyses the credit development of the steel industry led by the access policies.Secondly, the paper chooses the Analytic Hierarchy Process and Delphi method asthe basic and practical method for the banks to evaluate the steel clients. The papercategorizes the factors in evaluating the clients and set up an evaluation indexsystem with different weight. The paper uses Delphi method to make paircomparison of the above factors, and uses AHP to establish an evaluation structure.The paper also examines representative steel enterprise as illustration of theevaluating system and gets quantitative remarks of the enterprise which can help thebanks to decide whether to fund it or not.With the quantitative indexes and basis in the clients access process, the banks are able to make horizontal comparisons of the clients, learn the risk points based on theremarks of the various indexes, and decide differential credit policies. Thirdly, thepaper adds some improvements to the evaluating system, and discusses thepossibility of applying the evaluating system to the banks’ clients of other industries.