Study On Changes Of Credit Risks Of Listed Companies Based On KMV Model

As the basic risk in financial transactions, credit risk has been carefully researched by countless researchers and financial institutions in order to measure the risk precisely. Moreover, the measure of credit risk is the base of modern credit risk management, it’s generally developed from qualitative analysis to quantitative analysis, indices to models.Foreign academics began to look into financial warning early, such as Z-score model、Zeta model、Probit model、Logit model etc. Later, many new technologies of computer and information sciences were added in, like Artificial Neural Network, support vector machine. Modern credit risk model includes Credit Metrics, Credit Portfolio View, Credit risk+ and KMV model.Domestic academics about KMV mainly focus on verifying the validity of the model on domestic market, and doing some revision.As China’s financial market is brewing a huge systemic risk, monitoring credit risk is becoming crucial. As the major debtors, listed companies’ financial condition, management statement directly effect banks’ credit risk, and even the whole financial system. So, this paper focuses on the credit risk change within one year of Chinese listed companies based on KMV model, monitors the risk, and processes the domestic researches on financial warning, this also makes sense to current financial environment.