Legal Prevention Of The Credit Risk Of Commercial Bank Loan

Preventing the credit risk of commercial bank loan is an important goal of banking management ,and even the most important goal. But nowadays law can do it better by supplying a systematic framework of preventing the credit risk .The article has been written justly from the basis, and it divided into four chapters.Chapter 1 is the introduction of credit risk of commercial bank loan, in which the author has firstly stated the present condition of credit risk by a schedule-the amount of bank loan is rising, and the concentration risk is also rising, so preventing the credit risk is of much importance. And the author also details new challenge that can influence the credit risk, that is, financial globalization, universal banking, e-banking. Then the writer has defined the credit risk of commercial bank loan, and indicated its characters and types. Therefore from economic and legal angels, the writer has analyzed the causes of credit risk.Chapter 2 is entitled as theoretical introduction on legal prevention of credit risk. This chapter involves two issues: the theoretical basis of legal prevention of credit risk, i.e. theories of risk management of commercial bank; the relation of legal prevention and financial innovation.Therefore Chapter 3 deliberates on foreign legal system of preventing the credit risk. The writer think a sound supervision system of bank can bring a safe macroeconomic surroundings of preventing the credit risk. So some important supervision system is introduced: prompt corrective action(PCA), consolidated supervision. Then a series of institutions are detailed: credit assessment, preventing the concentration risk, the separatism of investigation examination and checking, prediction of the risk, classification of loan, ABS, credit derivatives; at the end of this chapter, the author also think sound bank governance can enhance the ability of preventing the credit risk.Chapter 4, the last chapter deliberates on the present legal condition of preventing the credit risk and its improvement. In form, we have really built a good legal framework for preventing the risk. In fact, the framework is poor, for its content is rough, and even lack of some important institutions. Just on the basis of the above-mentioned foreign legal institutions and our country's present legal condition, the author gives some advices.