Business Owners Personal Information In The Credit Risk Rating

In today's society, SMEs have become an important part of the national economy, Because of its flexibility and high plasticity, low threshold, easy access and so on. SMEs bring unlimited vitality to the economic development, also create numerous job opportunities, play an important role for the social stability. At the same time, because of its small and medium corporate governance, operating model, and financial systems are different with large enterprises with clear and traceable standards, as its "flexibility problem, plastic problem" has brought a lot of difficulties to the enterprise, one of the most obvious one is the financing of SMEs.This paper is based on the credit rating methods of small and medium commercial banks in China, through analysis of the SME's financing status, investigating the method of resolving SME's financing. Study found that the traditional credit risk rating system has many flaws, and it is not applicable for SMEs'credit ratings. But in fact, to solve the problem of SMEs'financing, banks bring in the credit rating system which using business owners'personal information as the main non-financial indicator. Based on the collection of data samples of the top three small and medium commercial banks with large financial credit occupancy rate of first half years of 2005– 2009 in Chengdu, a regression analysis is conducted. According to the regression analysis, it showed that the business owners'personal information have a greater impact on default risk, further analysis on the importance of business owners'personal information to the whole credit rating system.Based on the result of regression analysis, this paper reveals the significant impact on SMEs that the personal information of business owners may possibly generate default risk. With deeper analysis, it illustrates the obvious effect that the personal information has upon the credit appraisal systems of SMEs. To some extent, it is an indispensable index on a credit appraisal system since it can reflect the existing internal operating mode and future development potentials of SMEs in a rather real and scientific manner; it can reflect possible default risk in a direct way, that makes it the basis for the prevention and control of credit appraisal risk. Meanwhile, although it is important, the personal information of business owners can not substitute other indices but only combine with them, it can form a completed and effective credit appraisal system. As a conclusion, we can take actions to optimize the existing executed credit risk appraisal system for SMEs in bank, complete the financial credit and financing technology step by step, so as to provide beneficial enlightenment for leveraging hard financing problems in SMEs.