Analysis And Study On Loan Quality Of Listed Banks In China

Commercial bank plays an important role in the economic and social development, which has the responsibility to keep national economy safely. Loan is the major profitability asset of commercial bank. In response to the fierce competition of banking industry after the end of transition period to enter the WTO, banks in China raise new waves of listing, supplementing the capital, and expanding the scale of loans. Early in 2007, the crisis of Sub-prime Loan breaks out in the United States. Then the major financial institutions in American and European bear huge losses. The source of the crisis is the default of Sub-prime Mortgage in the United States real estate financial institutions. And it sounds alarm to banks in China about the problem of loan quality. The previous studies about loan quality mostly focus on the fields such as the risk of credit assets, the cause of non-performing loans, the countermeasures to resolve non-performing loans and the impact to the economy. But the studies from enterprise financial management perspective are rare.On the basis of previous theories, methods and related concepts about loans, this thesis analyzes the current loan quality of listed banks in China from 2004 to2006, compares the level of loan management between domestic banks and foreign banks, discusses the relation between the loan quality and achievement of management objectives, looks for problems existed and puts forward policy proposals.This thesis mainly studies as follows:(1) Introducing the concepts and classifications of loans, analyzing the risks and causes of loans, and then, stating the analysis indexes and evaluation methods.(2) Based on the data from 2004 to 2006, analyzing the current loan quality from the perspectives of loan scale, quality and structure, concentration of customer and industry, and finding the inspirations from the crisis of Sub-prime Loan in the United States.(3) On the basis of statistical analysis, combined with timing and section information, using empirical research method to study the impact degree to the management objectives of "efficiency, liquidity, security".(4) According to the results of comparative analysis and empirical analysis, identifying problems, drawing conclusions, and issuing proposals to raise the level of quality and performance management of loan.Through the study above, the thesis comes to the following conclusion:(1) The asset scale of China's listed banks grows rapidly, and the amount of loans rises steadily. The proportion of loans to total assets is in the trend of decrease.(2) The rate of non-performing loans in China's listed banks has been reduced gradually, which is better than the overall level of China's commercial banks.(3) Under the current situation of China's listed banks, the rise of loan customer concentration may contribute a little to the short-term profit growth, and doesn't have some negative impact to the liquidity and capital adequacy yet.(4) Manufacturing and transportation are still the main industries for the loan distribution. Because of the rapid growth in recent years, the real estate loans and personal loans should also be concerned.In view of the current situation, with the study conclusion, we bring forward the following countermeasures and suggestions:(1) Reducing the proportion of loans to total assets appropriately to lowering risk and achieving the diversification of assets.(2) Ensuring the recovery of loans in time.(3) Paying close attention to the changes in loan structure.(4) Strengthening the analysis of economic and industry, lowering the concentration of credit.(5) Developing a sound internal control system.(6) Improving the construction of social credit information system.(7) Innovation prudently for the derivative financial instruments.