On The Management Of Credit Risk Of Rural Commercial Banks

In the beginning, rural commercial banks tend to "Based on SMES and serve the localeconomy" as its business strategy, has played an important role in taking on the localeconomy, supporting SMES and stabilizing the regional economy, promoting theharmonious development of society. However, due to the special nature of the bankingsystem that the four major state-owned commercial banks account for the majority share ofthe domestic financial market, so more experts and scholars focus the study on thestate-owned commercial banks, just neglect of the rural commercial banks which is aspecial group and the its credit risk is lack of attention.Raising the level of credit risk management of the Rural Commercial Banks is asystematic process and need to continue to improve. By studying the problems of the RuralCommercial Banks in credit management, and find practical improvement measures. It’shave great significance in improving the quality of assets and promoting the local economyand building a Harmonious Society.This article will examine the perspective on the rural commercial banks which is theemerging financial strength, and to Taier Zhuang Rural Commercial Bank as an example.By the Survey and Analysis of credit risk management and the increasing Non-performingloans, analysis of the problem of Rural Commercial Bank Credit Risk Management:including lack of independence of risk management, Credit risk management seriously lagsbehind the level of development, high concentration of credit risk, other internal controlsystem is imperfect and so on. Then this article analyses the main reason for the credit risk:including of historical reasons, internal control mechanism of banks is notperfect.non-standard credit operations and some External causes, such as lack of socialcredit environment. In the last, this paper puts forward some policies and proposals aboutimproving credit risk management of the rural commercial banks: including improving thecorporate governance structure, strengthening Risk management system and the internalmanagement system, standard operating procedures of credit, establishing early warningsystem about credit risk, continuously improving the credit rating system, strengthening the credit culture building and so on.