Application Of RAROC Pricing Model In Small And Medium - Sized Enterprise Loans Of Bank Of China

SME(Small and medium enterprises) financing by 2014 research report shows that more than 70 percent of the financing needs of SMEs, but the main choice of bank loan financing, the choice of the bank, the main tendencies of the state-owned commercial banks. And the extent of the state-owned commercial banks, small and medium enterprises in stark contrast to the trust:China’s commercial banks, especially state-owned commercial banks failed to increase support for SME financing.30 years of reform and opening up, the rapid development of China’s small and medium enterprises in the field of tax contributions, income GDP, technological innovation plays a crucial role. In this regard, should the national policy-oriented, commercial banks are gradually changing focus. In the face of the quality varies greatly, the company system, the system is also not perfect SMEs, scientific and reasonable pricing of lending rates of commercial banks as a major problem facing. By studying abroad loan pricing system, based on RAROC found lending rate pricing in the category of general application in the field of international finance, especially for small business loans higher risk index, China in recent years has gradually formed based on RAROC model of lending rates pricing system.By RAROC model analysis, empirical study combining selected from the Bank of China Inner Mongolia Branch database 515 sample enterprises, RAROC verify the practicality of the SME loan from the practical level. Through various loan companies one by one rating under contrast, analysis of results, RAROC model can effectively measure credit risk, with strong applicability, and finally suggest improvements and practical application of the model based on lack of inherent problems in opinions and recommendations.