Research On Chinese Commercial Bank's Loan Pricing

Despite the bank's intermediary services are becoming diversified, but the current commercial bank loans are still the main business of banking. For most banks, loan assets account for more than half of total assets of banks ,the bank interest income account for 50% -60% of total income. In China, the commercial bank loan interest income in the operating income ratio has been maintained at over 60%. In 2005 the four major state-owned commercial banks the net interest income as high as 83.8%. Moreover, the financial markets also have an increasing number of loan and related financial product innovation, including loan securitization, Loan sales and other credit derivative products. These products are also banking transaction income from the market as part of the proceeds obtained. Therefore loans reasonable prices on the development of the banking and lending operations of all the success.Introduction This paper introduced the topics of significance Loan Pricing that research is market-oriented interest rate reform of the commercial banks operating management requirements, Loan Pricing is a commercial bank in the fierce competition with industry was an important business advantages, Bank loan pricing is to raise the level of commercial banking operations and operating efficiency of the urgent needs the establishment of a scientific and reasonable loan pricing mechanism, strengthen the management and interest rates, commercial banks operating success lies.The second chapter describes the basic pricing loans, loan pricing on the basis of the theory of credit rationing, The rate of adverse selection, the incentive effects of interest rates and loan guarantees, and other loan pricing theory was simple analysis and presentation. Analysis of the impact of loan pricing factors for China is to the pricing of loans to lay a theoretical foundation.Chapter III on the level of credit risk loans in loan pricing to the important role of pricing of credit risk for further analysis, Analysis of credit risk pricing core-measure credit risk of some elements, including probability of default, loss rate of default, risk exposure of non-expected loss, on the modern credit risk measurement model representatives-credit model, and analysis of the model in pricing loans, the application After the text of the loan pricing of credit risk estimation and measurement provide light.Chapter IV of this addition to the cost, price leadership, Customer profitability analysis of three international mature pricing methods to analyze and noted that the scope of its application. China highlights the status of loan pricing, China has long pointed out that as the implementation of interest rate controls, and related commercial banking system is imperfect. Make our existing loan pricing does not reflect the costs and benefits of the principle of symmetry, in the risk premium not perfect measurement, and analysis of these problems.Chapter V that with the market-oriented interest rates at an accelerating pace, the competition among banks is becoming increasingly fierce, the current relatively simple pricing model for the pricing mechanism decided the issue will become increasingly prominent. Therefore, in order to the existing loan pricing methods improved, Construction of the three loan pricing model supporting the use of loan pricing, The comprehensive approach in considering a loan prices internal funds transfer pricing, credit risk premium, the business tax rate, loan costs and customer relationship adjustments, and other factors, and try to default risk and duration of risk separately. In the development of internal funds transfer pricing, risk period for consideration of compensation, using credit monitoring mode in dealing with the probability of default. Finally, the perfect relevant policies set of proposals.In this paper, using the empirical analysis and standardization of analysis, interpretation and analysis summarized analysis of a combination of methods. From the perspective of the respective norms for foreign and domestic commercial bank loan pricing model introduced; Empirical Analysis of the other methods used for China's commercial banks pricing model system for in-depth study.The main innovation in this paper is constructed of loans to three loan pricing model supporting the use, The comprehensive approach in considering a loan prices internal funds transfer pricing, credit risk premium, sales tax loan costs and customer relationship adjustments, and other factors. Secondly, we tried to default risk and duration of risk separately. In the development of internal funds transfer pricing, consider the period of risk compensation; meanwhile, we should rely on the credit monitoring mode in dealing with the probability of default。This is the problems is insufficient due to the lack of practical experience. In this paper the design of loan pricing commercial banks without empirical data test formula may be exaggerated by certain factors. For related data is given certain assumptions, accurate data, the need of commercial banks in the practice of redefining, amendment. Jobs in the future which I will further study and improve their inadequacies and improve the loan pricing study.