The Research On The Improvement Of Credit Risk Assessment Method Of A Company

A Company grows rapidly since it has entered into China 1996.It has invested heavily in formation of huge capacity and become a key player in the relevant market.Meanwhile,A Company has encountered a stagnant situation along with its key customers decelerated their own growth and not a steady growth as originally expected.SME is China economic growth driver statistically in terms of revenue and profit.As downstream player,chemical SME is the driving force in its industry too.However,from the customer analysis of A Company,it’s found that SME accounted a steady but downward trend proportionately in sales revenue.From the perspective of credit risk management,this paper analyzed the unfitness and lack of pertinence to SME which led SME to be high risk customer mostly and hard to be business partner of A Company.A Company’s customer risk evaluation system counts on quantitative index inherited from parent company.SME is stopped outside of A Company due to its unqualified financial statement and collateral unsatisfied with ACompany’s requirement.As a result,they are classified as high risk customer.The thesis splits A Company’s customer risk evaluation into two parts: one for big customers and the other one for SME.The improvement for the SME part is to low down quantitative index weight and increase that of qualitative assessment,based on various consideration of SME credit factors.After study the international and domestic literature about the credit key factors as well as the SME characteristics,this thesis establish an AHP model with six categories and 28 indexes.Regarding the quantitative and qualitative ratio,this thesis takes reference of the rating guidelines of China Banking Regulatory Commission on Commercial Bank,BOC and ICBC as well as Dagong Credit Rating Co..It decides quantitative index takes 65% and qualitative takes 35% with consideration that A Company traditionally relies on quantitative indexes.After the revision of A Company’s credit risk evaluation method,this thesis takes a typical SME-X company as an example for test which proves that the revision is successful and effective.The improved method is comparatively simple and easy.Nevertheless,under the conditions of the rapid development of computing technology,the future for SME credit risk assessment should be via quantitative model,especially the artificial intelligence algorithm ones.