Study On The Problems In The Realization Of The Risk Classification Of Assets Of China Merchant Bank

With the complicated and inconstant financial situation, it is a subject of great importance how to improve risk management of commercial bank. Classification of assets is one of the most important concept to reflect the risk management capability of bank, which has a powerful impacts upon bank’s quality management of the asset. Against this background, domestic banks attach great importance to the research and practice of asset classification. Based on a thorough study on the10-grade-classification method, China Merchant Bank(CMB) has adopted and its effects, combined with the asset classification practice adopted by the commercial banks in China and Western countries, this paper, through the contrastive analysis of asset classification of CMB and China Constructive Bank(CCB), makes a conclusion of the pros and cons of asset management classification practice of CMB. Meanwhile, problems in the application of asset classification are underlined:firstly, problem with the system operation, including deficiency in the set-up of algorithm, system function of the asset classification task prompt and set-up for specific risk factor; secondly, problems in the management of classification, including deficiency in the management assessment, examination and approval procedure and personnel training; thirdly, problems in the classification information system construction which manifest itself mainly in the separation of classification in corporation business and personal business. On the basis of the above analysis, with the consideration of the requirement on and the development trend of commercial banks in China, this paper put forwards several suggestions on how to improve the asset classification efficiency in CMB:a)to integrate algorithm of10-grade-classification, to upgrade function of the system prompt, then increase the accuracy and efficiency of system operation; b)to improve the quality of related personnel with more strict training, management and examination; c)to expand the asset classification business; d)to upgrade current10-grade-classification system, to be more strict with the risk assessment and management of NPA; e)to improve information system construction for10-grade-classification, consequently improve original data quality and classification integration; to stress the role of asset classification in a comprehensive risk management by establishing an asset classification system geared to comprehensive risk management.In this paper, with the application of contrastive analysis, literature research, data analysis and induction method, problems in the current practice of asset classification in CMB as well as its causes are analyzed, with the corresponding suggestions provided.