A Research On The Performance Of Commercial Banks Under The Folk Lending Crisis Of Wenzhou

The financial crisis of 2008 has had an unprecedented influence on global enterprises. And under its influence, most mid-and small-sized enterprises in China made losses on different degrees, since Zhejiang Province is adjacent to the coast and has a frequent commercial intercourse with some developed contries in Europe and America. The global financial crisis has trapped the mid- and small- sized enterprises in areas of Jiangsu and Zhejiang in capital predicaments. Meanwhile, the predicaments also has doubled the credit and loan pressure of commercial banks in different areas, which largely influenced the business performance of commercial banks and brought some hidden troubles to the outbreak of the folk lending crisis of Wenzhou in 2011. Since 2011, the captains of some private enterprises in Wenzhou have successively run away, which resulted in the close-down of these enterprises. After that the situation became worse and nearly one hundred enterprises went bankruptcy. Ultimately, the folk lending crisis of Wenzhou burst. With the influence of the folk lending crisis of Wenzhou, commercial banks in Wenzhou area suffered a sharp decrease in operating profits and gained its new high in the ratio of bad loans. Taking the opportunities of the financial reform, the government has take some effective measures. Up to now, although the commercial banks has went out of difficulty on the whole, credit risks hasn’t been reduced effectively; although the effort to deal with bad loans has evidently been intensified, there are still many the newly-increased bad loans. As a result, the bad loans balance are still increasing and the vitality of financial market are decreasing to some extent. Were the management ability and risk prevention ability of commercial banks couldn’t be improved, the present stituation of stable development of the real economy and socitey in Wenzhou would be influenced.As the most representative municipal commercial bank in Wenzhou area, Wenzhou Bank is selected as an example in this thesis. By using factor analysis, this thesis systematically analyzes the profitability, security, mobility and future expansibility of Wenzhou Bank. This thesis also selects and analyzes its business performance level in the period of 2007-2008,2009-2011,2012-2013. After comparison, this thesis has got the reasons why the folk lending crisis of Wenzhou has influenced the business performance of Wenzhou Bank. It also found some problems and made some suggestions and countermeasures on improving the business jperformance level of commercial banks. By doing so, this thesis expects to help municipal commercial banks to effectively and steadily improve the business performance by using market operation priciple and scientific management of financial market.