Agricultural Credit Default Risk Of Macro Stress Testing

Stress test has been widely used by the first-class business and investment banksover the last century, which primarily focuses on testing the shock resistance abilitywhen an independent institution confronts with the excessive stimulus or enormouspressure of the market. Gradually, it also has been accepted in the worldwidefinancing institution, including numerous banks of China after the advent of a certainareas testing in2003. Currently, there is an increasing number of studies about thestress testing, the accurate model of it, unfortunately, has not been created yet.To start with, this essay will elaborate on the writers’ own standpoints, combiningwith other academic dissertations, namely, to study the credit of agricultural loans andimplement the stress test, as well as several relative conclusions. And the gist is to tryto commence the test of agricultural loans’ credit, and enable to start the further study,since the state council has made emphasize on the improvement of the financingservice quality for ‘three rural’ for years. Additionally, to achieve the target, oneshould clarify the quality of agricultural loans’ credit, in order to enhance the service.The analysis of one of the agricultural banks will be illustrated in follow contents.The essay will be divided into two sections. For the first section, chapter1, chapter2and chapter3, which contain the overall design ideas (background, meaning, studymethod, technique, article level, and other academic conclusion), theoretic statement(current situation of agricultural loans, the record events and studies review) as wellas the concrete approaches of stress test. The second section (chapter4and chapter5),practically, gives the regression analysis and establish the stress test model eventually,is the core part of the whole essay.On one hand, the well-organized discussions of the attempt of stress test, in thewriters’ opinions, are a marvelous beginning or a mirror even a comparison for thesimilar tests in the future. On the other hand, by learning the undesirable assets ratioof agricultural banks’ credit, the reasons of why agricultural banks become the latest ones merge into the market and the most bad debts exit there are apparent.