Research On Internal Control Of LY Rural Commercial Bank’s Credit Risk

The task of poverty eradication has been completed on time,and the era of rural revitalisation has come one after another.Rural commercial banks are an important part of China’s financial system and play an irreplaceable role in promoting rural financial development.Rural Commercial Bank,as the main financial force supporting the "three rural areas" and small and micro enterprises,are an important force in achieving precise poverty eradication and rural revitalization.In recent years,under the strict regulatory policy of "no loans to counties and no funds to provinces",rural commercial banks have a large amount of idle funds from interbank investments,and as they operate a single type of business,the only way to improve the efficiency of their use of funds is to strengthen credit allocation.However,while the scale of loan placement has continued to increase,some problems have gradually come to light.The non-performing loan ratio of rural commercial banks has been rising in recent years and is much higher than the average level of commercial banks.At present,the main income of rural commercial banks comes from deposit and loan spreads,so it is urgent to further improve the internal control of its credit business to ensure the compliant issuance of loan funds and smooth recovery at maturity in order to reduce the non-performing loan rate,so as to better serve the national strategy and rural economic development in the new era.Based on this,this paper selects LY Rural Commercial Bank as the research object,under the guidance of the theories related to the internal control of credit risk of commercial banks,analyses the current situation of the bank’s internal control of credit risk,then adopts qualitative and quantitative analysis methods such as questionnaire method,hierarchical analysis method and fuzzy comprehensive evaluation method,establishes the evaluation system of the bank’s internal control of credit risk,finds the existence of its internal control of credit risk according to the evaluation results The problems of the bank’s internal control over credit risk were identified based on the evaluation results,and then specific solution measures were proposed to address the problems.The results of the study show that LY Agricultural and Commercial Bank’s internal control over credit risk is generally average and sound,but there are still deficiencies,including the weakest risk assessment link,and deficiencies of varying degrees in four areas:internal control environment,control activities,information and communication,and internal oversight.Based on this,strategies and recommendations are proposed to solve the problems:optimise the credit organisational structure,strengthen the construction of credit human resources,improve the risk assessment system,enhance the risk response capability of credit personnel,strict pre-lending investigation,strengthen post-lending supervision,strengthen the construction of credit information systems,improve the information and communication mechanism,improve the credit supervision mechanism and enhance the independence and professionalism of internal audit.