A Study Of Macro-Economic Fluctuations And Credit Risks Of China's Commercial Banks

Chinese reform and opening-up has been the whole 30 years, China's commercial banks also continued to develop and grow. The credit risk has been regarded as the main risk by the China's commercial banks. And Macro-economic fluctuation, as an important factor of commercial bank's credit risk, has been thought significant by the foreign banking sector. In China, many commercial banks still use old evaluation methods, which do not take the factors of macro-economic fluctuations into account. Many commercial banks in developed countries which have gone through a complete cycle of Macro-economic are affected by economic fluctuations in many aspects, and even some commercial banks bankrupted as a result of that.These facts are very important for China's commercial banks for references to control credit risk. Through the "the borrowers", "the banks " and "the government", this paper set out three areas of macroeconomic fluctuations of the commercial banks of credit risks. At the same time, through the study of foreign commercial banks in the different stages of economic fluctuations, as well as the main existing commercial risk measurement approach, this paper analyze the relationship between macroeconomic fluctuations and credit risk of commercial banks. Finally, this paper collects and analyzes the data and policy from 1993-2007 through both qualitative and quantitative methods. The study found that Chinese commercial banks' credit risk affected by the macro-economic fluctuations significantly, in particular the role of national policies, and the two have the same trend. The result is useful for China's commercial banks of enhancing risk-resisting ability.