Commercial Bank Investment And Loans Linkage Model Research In China

As we all known, the financing difficulties of small and medium-sized enterprises always be one of the problems which urgently need to be solved in the financial market, most of them have high risk, so that our commercial banks would not like to offer them money. The situation gets more serious for science and technology enterprises, these enterprises often been in early-stage and have little own assets, there is fatal flaw in financing-the lack of effective collateral. Those can replace physical mortgaged property is intangible assets such as patent, invention of science and technology. But it's not such fortunate in reality; there are only little triumphs of the patent pledge financing. Small and medium-sized enterprises have some advantages that large firms don't have, such as the policy support and less financing amount required. What's more, they need different services which are easy to achieve. These enterprises'growth are also good for China's economic development.At the same time, our commercial banks are facing a business transformation. Banks'profit more depends on the interest spreads of saving and loan for a long time. But with the opening up of financial environment in China, the interest rate marketization and the impact of the Internet financial, commercial banks should look for the new channel of profit growth. Investing small and medium enterprises can improve banks'profits. "Investment and loans linkage", this innovative business can solve the risks and benefits to a great extent the unequal status of enterprise credit business, at the same time, expend the channel of the business of commercial banks and promote the business transformation of commercial banks."Investment and loans linkage" means commercial banks on the basis of the evaluation and selection of the enterprises, to invest the enterprises by the "equity and bonds" mode. Besides that, the banks provide enterprises with funds management and business advisory services, using its own resources to support the growth of enterprises, in order to gain the interest income and excess returns. This model effectively alleviate the enterprises' plight of a shortage of funds, and has important significance for promoting the economic development.This paper discuss the need for commercial banks and enterprises to carry out Investment and loans linkage. By comparing and analyzing the mode of Investment and loans linkage both at home and abroad, we can find there are some shortages in our country. Our commercial banks at present widely cooperate with PE/VC to achieve benefit-sharing, risk quintal and multi-win-win situation. But due to the limitation of our laws, our commercial banks can only invest as creditors, so their benefits and risks do not match. What's more, commercial banks and risk investment institutions have different risk preference degree, it also affects the development of the business.At last, this paper puts forward the future development of our country's Investment and Loans linkage's business direction and relevant suggestions by drawing from mature system of the Silicon Valley Bank. Not only relax restrictions on our commercial banks on the external supervision, but also build a complete business system. Investment and Loans linkage has a higher requirement of professional and interdisciplinary talents, so our banks should organize and train their own talent team. And in order to help the development of enterprises, commercial banks should also introduce the chain enterprises to the firm.Through the above summary and analysis, and combining the current situation of our country, this paper finds that our country commercial banks shall actively carry out Investment and loans linkage. At an early stage, by establishing good relations with risk investment institutions, commercial banks can get project experience and cultivate professional talent team. If the case of future policy environment allows, our banks can form a complete business system, from the internal and external cooperation Investment and loans linkage gradually transforms to their internal Investment and loans linkage.