Credit Risk Analysis Of China City Commercial Bank

As an important component of China’s banking system, city commercial bank plays an important role in the economic development. However, due to the special historical development background, city commercial banks are different from the large state-owned commercial Banks and other joint-stock commercial Banks both in performance and credit risk management.From the point of development, city commercial banks are an important and special group of China’s banking system, urban credit cooperatives, and its predecessor is established in the1980s. Urban Credit cooperatives has play an important role in solving social employment, services to small enterprises, convenient living, support local economic development, it also has accumulated a lot of risk during the decades. Due to reasons such as system and environment, city commercial banks’ risk management, especially the credit risk management not only is far from the mature international commercial banks, but also has certain insufficiency in comparing with large commercial Banks, joint-stock commercial Banks.City commercial bank’s development, evolution and the reality plays a particularity role in city commercial banks’ credit risk management, the limitation of the scope of business decides the importance of the credit risk management, the regional business area has determined its credit risk management multilayer, the difference of the degree of close relationship with local government has determined the complexity of its credit risk management and the particularity of the service object has determined the dynamic of credit risk management.Based on the framework of the Basel capital accord, this paper has analyzed the reality of China city commercial bank credit risk management, from the aspect of credit risk measurement, international comparison, management target construction, optimization of external environment, this article has discussed the problem of city commercial bank credit risk management. Based on panel data model of city commercial bank credit risk measurement and the probability distribution of urban commercial Banks default ratio, this article has analyzed the relationship o between capital structure distribution and its assets.From logit model and Credit Risk+model, this article has analyzed the reality of city commercial bank credit risk management, based on asset quality, capital adequacy, asset structure, the article has examined the status of China’s city commercial bank Credit Risk management. From the angle of culture, corporate governance, internal management construction, the article has built the new target schema of city commercial bank credit risk management. From the credit system construction, information disclosure system, and legal environment construction, the article has built the external environment optimization system of city commercial bank credit risk management.Based on the property rights economy, asymmetry information, externality theory, combining the international comparison and analysis of domestic, follow the "model establishment, sampling choice, empirical test, conclusion analysis" technical route, from the perspective of risk measurement, this study found that:(1) the research achievements of the Basel committee and the COSO has become widely accepted in worldwide, China’s commercial Banks should adapt to the trend;(2) City commercial Banks should keep to a technical implementation path that not only conforms to the Basel Ⅱ and also in accordance with China bank regulatory reality;(3Accurately quantification of risk is the future trend of risk management, but all of the risk of quantitative management methods and technology should be able to better reflect the reality of risk management;(4) The construction of risk management and the risk quantitative management techniques, which in line with the credit risk management system, is the key to improve the credit risk management.