Research On The Credit Risk Management Of Commercial Banks In China Under The New Basel Capital According

Credit risk is the major one which the financialinstitutions have to face, with the acceleration of economic globalization, great progress has been achieved in the field of dealing with the credit risk in the past 20years. In developed countries,credit risk administration in commercial banks is relatively mature,they have formed corresponding system both in theory and in practice. Constantly, new technological methods have been taken and sampled to analyze the credit risk. By contrast, in China, the administrative system of dealing with the credit risk in commercial banks is far than perfect, the management technique is so simple and inadequate to meet the need of management of credit risk in commercial banks. Issued in June, 2004, New Basel Capital According has been regarded as a standard for international banks and has exerted a strong influence on dealing with credit risk. It makes the competition more standardized and fair among the international banks, especially some active ones. Financial market in China is going to be open gradually, so how to accelerate the quantitative management of credit risk and establish the appropriate management system of credit risk on the basis of the current situation of commercial banks in China is a task of top priority after entering World Trade Organization.Based on above, firstly, the paper summarized the basic theories of credit risk and current research in this field in China and abroad, served as the theoretical foundation of the paper. Secondly, the paper analyzed the main contents and characteristics of New Basel Capital According, served as scientific guide of the paper. Thirdly, the paper analyzed the current management status of credit risk in commercial banks in China and investigated the influence of New Basel Capital According in commercial banks in China, in order to reconstruct administrative models and systems of credit risk in commercial banks. Finally, according to New Basel Capital According, based on KMV model, the paper constructed the quantitative model of credit risk and administrative system, and put forward some practical recommendations to improve credit risk management after commercial banks are fully open under the circumstance of new regulations and new methods which commercial banks have to follow.