Study On Credit Risk Of Commercial Bank In China

Credit risk measurement is the base of credit management, which is the kernel of bank management. Because of a large amount of bad property in bank and the competition with foreign banks, the improvement of credit risk measurement level become the important project for domestic banks.Today,credit risk has become more and more complex, attracting more and more focus from many countries around the world. When much research effort was paid for the research of credit risk, many new models and methods have been developed and put into practice. Therefore it is an important task for China's banking to take the advanced technology of credit risk measurement from other countries for reference and set up models and methods suitable for China. With the above background, this paper decided to choose the credit risk measurement of commercial banks as its research subject.The paper reviewed the literature about methods and articles relative to credit risk measurement. Then the author chooses samples from the listed companies which are customers of banks, and adopted an empirical approach by using the LOGISTIC model. Considering the situation of our country, the author chooses the factor analysis modified the LOGISTIC regression. The result shows that the effect of the latter is better than the former. Undeniable, there are also some problems of the model: the analysis can only be used one time every year because the data of companies is published only one time a year; the financial index chose for the analysis is influenced by author's subjective judgment, the model which is appropriate for this term may not so good for the next term.Above all, we should establish our own model which is suitable for our country's environment, and take some other actions such as creating new method for controlling credit risk, establishing comprehensive data base and developing credit-evaluating institution, etc.