The Research Of Non-performing Loan Disposal In Chinese Commercial Banks

Over the past years,benefited from the rapid development of the economy and the reform of the financial market,China’s large banks and small or medium-sized banks have all achieved good development.Among them,local small or medium-sized banks represented by city-business activities have been rapidly improved in many aspects.However,the banking industry operates as a risk.As the scale of assets continues to expand,various types of risks are also exposed.According to the data released by the China Banking Regulatory Commission,the operating environment of China’s commercial banks has been declining,and the growth rate of net profits has slowed down significantly since 2014.The regulatory indicators such as non-performing loan balances and non-performing loan ratios have continued to deteriorate.At the end of 2015,China’s commercial banks’ total non-performing assets has reached totaled 1,274.4 billion yuan,almost double the 646.1 billion yuan at the beginning of 2014.At the end of 2017,the balance of non-performing loans of commercial banks in China reached 1,705.7 billion yuan,and the non-performing loan ratio was 1.74%.Non-performing assets,as an objective product of the financial development cycle,not only damages the development of the banks themselves,but also has powerful economic destructive power,which reduces the allocation of social resources and lowers economic efficiency.Therefore,it is very urgent for the analysis and disposal of non-performing loans.Based on the research of domestic and foreign scholars,this paper comprehensively applies the theory of credit risk management,the theory of commercial bank loan management and the theory of information asymmetry to analyze the overall situation,harms,formation reasons and disposal status of bad loans in China’s commercial banks.Then,taking the local city commercial bank ZQ Bank as the specific research object,the quantitative analysis method and the comparative analysis method are mainly adopted.From the perspective of non-performing loan increment and non-performing loan stock,the main features of the non-performing loan of ZQ Bank are analyzed.Through the specific case studies,this paper has summarized the specific measures and deficiencies of ZQ banks in terms of credit management,risk prevention,and bad handling.Finally,by referring to the advanced experience of non-performing loan disposal by foreign commercial banks,suggestions on prevention and disposal of non-performing loans for commercial banks are proposed both externally and internally.Externally,actively promote the reform of the financial system and further improve the construction of the social credit system.Commercial banks must continuously strengthen their ability to predict changes in the economic situation and the industry.Internally,do a good job in resource allocation to improve the level of credit management,optimize the structure of credit assets,promote the level of refined management,enhance the ability of handling non-performing loans and raise awareness of risk prevention,and curb the emergence of non-performing loans from the source.Suggestions for specific non-performing loan disposal measures are proposed,and it is expected that they will be helpful to the innovation and optimization of non-performing loan disposal of commercial banks.