Research On Dispose Nonperforming Assets Of Chinese Banking Sector

Nonperforming assets, a dynamic concept to banks, refers to the assets that unable to realize expected yields under current conditions. Before we could design a right program to dispose nonperforming assets of Chinese banking sector, we should know the situation of it. Basing on the analyzing on various materials, we conclude that the scale of nonperforming assets of Chinese banking sector is underestimated while its quality was overestimated. Commercial financing is used as public financing, mistakes in enterprise operation, and mistakes of commercial banks themselves, all these factors make the nonperforming assets of Chinese banking sector.National financial balance theory and Samuelson's supply theory offer a theoretical basis for disposing nonperforming assets. The most popular dispose policies include discharging bank; disregulation in banking sector; and government participating bank assets reconstrucruring following with enterprises assets reconstructuring. The most popular dispose include outstanding measure, flow measure and fundamental reform to bank. The models include bank self-treatment, centralized trusteeship treatment and direct nonperforming assets peeling off. According to international experience, we have several important inspirations that disposing to nonperforming assets include fundamental and exterior measures, while fundamental measures are important, that the decision time of nonperforming assets treatment affects its result and cost.Current Chinese nonperforming assets disposing systems mostly include bad debt reserve system, supplying bank capital, centralized trusteeship treatment by setting up asset management companies (AMCs), and bank self treatment. Though this system has already got some effect, while after we thoroughly analyzed into statistic data, it has limitation in treatment efficiency, mainly in the ratio of nonperforming assets has been still high, little effect has been achieved by debt to share.The main factors which influence the efficiency of nonperfonning assets disposing of China include, the institutional limitation of AMCs itself, bank paying little attention to self treatment, localization and low efficiency of disposing measures, lack of well law and policy conditions, immature market. The author offers a related discussion on path to above questions in this paper.