The Research On The NPA Of The State-owned Commercial Bank Of China

It is an important part to the banking function course in market economy. The banking system of a lot of countries in the world all faced the serious bank crisis in different periods. Among them, one of the reasons that damage the sanity and safety of the bank and lead to the bank crisis is that a lot of non-performing assets (NPA) have been produced directly. Handling NPA effectively, not only relate directly to the economic benefits, competitive power and self-development of the bank, but also influence economic normal running and the strict precautions of financial risks. The state-owned commercial banks of our country are the main banking parts in China, its public or covert NPA will hinder them from participating in the keen competition of financial markets after entering into WTO. So, it is necessary for our country to vitalize the NPA of the banks and raise the assets quality of the banks in order to meet requires of inevitable financial globalization.The essay systemically describes the concept of NPA of the bank, the reasons why NPA have been formed and the current situations of the NPA of our country ,and analyses concretely the operations about the NPA of other main countries in the world, and then "puts" forward some suggestions to handle effectively' the NPA of ihe state-owned commercial banks in our country , which have relatively strong pertinence, feasibility and effectiveness.As four major state organizations specially handling NPA of the state-owned commercial banks, four asset management corporations (AMC) have scored gratifying achievements since established. However, the AMC have exposed some questions in the course of running. It is still in the transferring stage from planned economy to market economy at present in China. We must adopt marketizational and specialized methods while handling NPA. AMC have exposed some limitations which require perfecting their operating mechanism and improving the operational efficiency of the AMC further. And, the methods that have been used to handle NPA seem slightly single. If we want to digest well the NPA, we must innovate the methods in short time. Along with the development of capital market, no matter the external environment or the inside condition, the feasibility of our country using the capital market to handle NPA strengthen progressively. We can use such methods as loans recombination, NPA-sale, debt to share and asset securitization.In the course of AMC operation, cost-efficiency issue, legal-person management structure, operation mechanism of marketization, market-oriented organization systems of operations, and moral risk issues determine them difficultly in cooperating. So, according to the overall situations, we must set up a mechanism of cooperating-nationwide NPA handling-centre, which can offer an ideal platform handling NPA effectively.