The Research On Some Management Counter-measures Of The Non-performing Loans Of The Commercial Banks

Financial risk jumps into the focus of people's immediate attention in recent years, especially after the American subprime mortgage crisis set off a global financial crisis and seriously threatened the stability of the banking system worldwide. Basically, the host of problems banks are faced with have their origins in non-performing loan, and it is non-performing assets together with the fragile banking system that proves to be the direct cause of this crisis. Due to the magnitude of the global financial crisis, a grave situation is presented to the Chinese government. In order to ensure the smooth growth of China's economy against a global economic downturn, the Chinese government is prepared with a series of policies and measures, with the help of which China's commercial banks have shown substantial increase in credit loan business. Meanwhile, it should be noted that the secure, efficient, and stable operation of the financial system is a key factor for the stability and development of the overall economy. Therefore efforts should be made to effectively prevent and control the recurrence of non-performing loan of commercial banks.In conclusion, the actual occurrence of the risks involved is the direct reason for the American subprime mortgage crisis, which also sounds the alarm for the management and counter-measure of China's non-performing loan. Given that the non-performing loan of China's financial banks originates from a unique historical background, and that fallacies do exist in the risk management mechanism of bank loan, it is suggested that inward and outward measures should be taken to strengthen the management of non-performing loan of China's financial banks. For the inward measures, efforts should be made in areas of loan procedure, loan rights administration system, balance and surveillance mechanism and relevant enterprise loan control, in order to improve loan redemption system. With regard to the outward policies, it is advised that legislation related to the surveillance and administration of financial risks should be strengthened and perfected, and that judicial control measures should be taken to avoid the occurrence of non-performing loan of banks with emphasis on the establishment of financial safety zones. In addition, considering the trend of commercial banks changing into financial stock-holding companies, efforts should also be made to establish sound concept, system and rule of law surveillance and administration, in order to maintain and enhance the stable and healthy development of China's financial stock-holding companies.