The Research Of Real Options In The Bank's Credit Strategy

The financial crisis spread like a plague to the world, China's economy was deeply influenced by it. This is more difficult for the development of the small and medium-sized enterprise (SMEs). How SMEs can raise capital and survive the crisis will become a social concern.In China, SMEs in ensuring economic development, promoting technological innovation, increasing employment opportunities, maintaining social stability, played an extremely important role.According to the statistics, SMEs has accounted for more than 99% of total number of enterprises, has created almost 60% of economic outputs,50% of tax revenue, has provided almost 80% of jobs; and in independent innovation, SMEs owns 66% patented invention,74% of the technology innovation and 82% of the new product development. It can be said that SMEs continued rapid growth of China's economy contributed. However, during a long time, more than 80% of the SMEs liquidity needs were not met,60% of SMEs didn't have long-term loans.In China SMEs are generally facing the problem of shortage of funds.From the perspective of commercial banks:At present, commercial banks profitability generally sluggish, the main reason is that the main business of the bank-Credit field continuously reduce the rate of profit contributionIn this kind of situation, developing the small and medium enterprises is a good way for banks to find new profit growth point of great significance.Most study of credit decision-making aim at macro perspective such as financial supervision and national economic policies. From the point of micro level, this paper innovatively introduces real option method of venture investment to the field of commercial banks'credit assessment and has research on multi-stage real options theory in the use of credit decision-making This paper reviewed the research actuality of credit decision-making approaches don't match with high-tech SMEs very well and the flexible value of management should not be neglected.Based on the enlightenment of venture investment, this paper compared the similarities and differences of the venture investment and bank credit. Then summarized the theory of real options approach, analyzed the feasibility to use the multi-stage real options model. Then analyzed the actuality of credit decision-making, improved high-tech SMEs credit decision-making and put forward relevant method and flow. At last, studied a case of the biological and medical company, and found that the option value of high-tech SMEs should not be ignored in credit decision-making. Comprehensively applying various methods, such as quantitative analysis, qualitative analysis, mathematical derivative, programming, to evaluate the value of start-ups firms with the theory of real option, this paper makes a little contribution to the related research fields. The methods are easily-operated and portability.