Research On Credit Risk Management Of Rural Credit Cooperatives

As the main force of Rural finance and contact ties with farmers, Rural Credit Cooperatives provides financial services and rural funds.The level of risk of its loan not only directly related to their own survival and development, and also related to China’s agricultural structure adjustment and rural economic development. As our country continue to increase efforts to support three rural, agricultural credit amount increasing rapidly. The credit risk control has become a critical problem. if the lack of effective risk management and control, it will be seriously hampered the development of rural credit cooperatives, also affecting our new rural construction. In this case, the credit risk of rural credit cooperatives become an issue of practical significance.This paper first introduces the domestic and foreign research on credit risk management and analysis the content of worth learning, as the theoretical basis of the full text of the study; Then by analyzing the SX credit cooperatives operating conditions, including the credit risk management, organizational structure, rules and regulations, it discussed the status quo of credit risk management of SX credit unions. Second, drawing on existing research results, combined with the SX credit cooperatives operating practices and specific operational data, the risk faced by the SX Credit Union loan is divided into four aspects.The risk includes moral risk, operational risk, credit risk and market risk. Then this paper analyzed main reason of credit risk. The external causes is the rural poor credit environment. Meanwhile the internal risk is awareness of internal Staff, risk management system is not clear enough. In order to reduce credit risk for each of the above four aspects of credit risk this paper proposed control measures, including strengthening the moral construction, improving the incentive mechanism, standard operating procedures, and improving the quality of personnel, ricing business types, and improvising the organizational structure to improve SX Credit social business soundness, effective control of the credit risk.This paper is helpful for SX Credit Union to realize the credit risk and also is helpful to improve business condition.Meanwhile this paper has both theoretical and practical meanings and is suitable to guide credit risk precaution of domestic rural credit cooperatives.