The Analysis Of Credit Derivatives Apply In Our Banks' Credit Risk Management

The method of credit risk management has experienced a process from classical credit analysis to modern credit engineering. Credit derivatives are just the outcome of financial engineering. They can separate and transfer credit risk of the assets in order to reduce the holder's risk exposure, which has great value to credit risk management of our banks. So, the aim of this paper is to analyze credit derivatives comprehensively, and use SWOT model to anatomize the strengths & weaknesses of the tool, opportunities & threats of practice, in which the paper emphasizes the problem of obstacle in valuation. As the result of SWOT judgment, it is feasible to apply credit derivatives in our banks. In succession, on the base of our banks' credit risk and risk management status, this paper points it is also necessary to applied credit derivatives to manage banks' credit risk in our country. At the same time, the project of developing credit derivatives is a systemic construct from market to banks and supervising.