Yueyang City Commercial Bank Non-performing Asset Disposal Strategy

Currently, there are many problems in operations in city commercial banks. The large amounts of non-performing loans have seriously hindered their development and comprehensive competitiveness, thus becoming a key cause of operational loss for most city commercial banks in China. For the sake of enhancing competitiveness in World Trade Organization, commercial banks need to position themselves correctly, raise their technique level, improve financial innovation, develop intermediate business, establish scientific human resource mechanism. All these measures rely on preventing further increase of non-performing loans and gradual resolve of historical bad loans. Only with fewer burdens of bad loans, can the commercial banks enhance their competitiveness. This paper focus on the systematic root of non-performing loans and the disposal strategy for non-performing loans for the Yueyang Commercial Bank.This paper has first analyzed the way of the domestic and international bank dealing with non-performing loans and the particularity of city commercial bank dealing with non-performing loans , secondly, investigated the non-performing loans present situation of Yueyang commercial bank and has analyzed the reason that non-performing loans produced: Imperfect structure of corporate governance, with excess intervention from government executive order; morbidity internal risk control mechanism, weak disposal measure of non-performing loans .During the transition period between China's WTO entry and full opening of banking sector to foreign competition, the Yueyang Commercial Bank should establish a mechanism to prevent further increase of bad loans. Therefore, the measures shall include learning the experience of foreign banks in corporate governance, pursuing the interest of shareholders in addition to protecting the depositors' asset safety, eliminate the systematic flaws firstly, Secondly, it is to mould social credit, reinforced credit management, optimize credit increment; Meanwhile the bank should also learn the experience from abroad and use the model of three-level filtering for bad loans to combine the self-disposal and trusted-disposal methods in handling current non-performing loans.